Manama, Bahrain: Bank ABC (Arab Banking Corporation B.S.C.) - Bahrain Bourse Trading Code
“ABC” - today announces its results for the half year 2023.
Bank ABC continues its strong performance in the first half of the year, driven by diversified
business growth and benefitting from a rising interest rate environment. Total Operating Income
grew by 18% year-on-year (YOY), whilst Total Assets crossed US$ 40 billion for the first time in
history. Capital and liquidity ratios remained at strong levels. The Bank has recorded a 72%
increase YOY in net profits attributable to the shareholders, which stand at US$121 million.
During this period, the Bank also won a number of distinguished awards recognising the Bank’s
innovation and digitisation initiatives. Global Finance’s “The Innovators Awards 2023” named, ABC
Labs as one of “the World’s Best Financial Innovation Labs”, a recognition given to institutions
leading the digital revolution in the global banking industry. Bank ABC has also been presented
with the “Top Innovations in Finance” award by Global Finance, an accolade that underscores the
Bank’s outstanding Digital Transformation Programme which delivers an unparalleled,
personalised banking experience to corporates and individuals.
Bank ABC's Group Chairman, Mr. Saddek Omar El Kaber remarked, “We are extremely
pleased with the Group’s excellent growth in profits during the first half of 2023. Our balance
sheet remains healthy and strong. We look forward to continuing this great momentum during
the rest of the year as we steadily progress on our strategic journey to build our “bank of the
future.”
Detailed summary of the Financial Results is explained below:
Q2 2023 Performance Highlights
- Consolidated net profit attributable to the shareholders of the parent, for the second quarter
of 2023 was US$61 million, 56% higher compared to US$39 million reported for the same
period last year.
- Earnings per share for the period was US$0.02, compared to US$0.01 in the same period last
year.
- Total comprehensive income attributable to the shareholders of the parent was a profit of
US$110 million compared to a loss of US$111 million, reported for the same period last year.
Last year was impacted by change in fair valuations of our bond portfolio and net impact of
foreign exchange translation in foreign subsidiaries. These were relatively muted in the current
period with the strengthening of the Brazilian Real, to some extent counterbalanced by the
depreciation of the Egyptian pound against the US$.
- Total Operating Income was US$312 million, 14% higher compared to US$273 million
reported for the same period last year, benefitting from core underlying business growth and
higher interest rates.
- Operating expenses were at US$190 million, 10% higher than US$172 million for the same
period last year, from a combination of expenses incurred for supporting business growth,
strategic transformation initiatives and general inflationary increases. The Group continues to
enforce appropriate cost discipline without compromising on investment into our digital
transformation and strategic initiatives.
- Impairment charges (ECL) or credit loss expenses for the quarter were US$30 million
compared to US$26 million reported for the same period last year, reflecting the quality of the
Group’s asset portfolio and broadly in line with our historic credit loss experience.
- Tax charge for the quarter was US$17 million, compared to US$22 million for the same period
last year, which is in line with the profit before tax in the overseas subsidiaries.
H1 2023 Performance Highlights
- Consolidated net profit attributable to the shareholders of the parent, for the first six months
of 2023 was US$121 million, a growth of 72% compared to US$70 million reported for the
same period last year.
- Earnings per share for the period was US$0.04, compared to US$0.02 in the same period last
year.
- Total comprehensive income attributable to the shareholders of the parent was a positive
US$109 million, compared to a loss of US$103 million reported in 2022. Last year was
impacted by change in fair valuations of our bond portfolio and net impact of foreign exchange
translation in foreign subsidiaries. These were relatively muted in the current period with the
strengthening of the Brazilian Real, to some extent counterbalanced by the depreciation of
the Egyptian pound against the US$.
- Total Operating Income was US$611 million, 18% higher compared to the US$520 million
reported during the same period last year.
- Operating expenses at US$ 364 million was higher by 10% compared to US$331 million,
during the same period last year, resulting from a combination of strategic investments and
transformation initiatives, supporting business growth and general inflationary increases. The
Group therefore has positive income/cost ‘jaws’ of 8% with a consequent improvement in the
cost/income ratio. The Group remains focused on disciplined cost control while continuing our
investments into the strategic digital initiatives to build our ‘bank of the future’.
Balance Sheet
- Equity attributable to the shareholders of the parent and perpetual instrument holders at the
end of the period was US$4,153 million, compared to US$4,095 million reported at the 2022
year-end, after absorbing the impact of dividend payment and FX translation on equity in
subsidiaries.
- Total assets crossed the US$40 billion mark for the first time in the Group’s history. Total
assets stood at US$41 billion at the end of the period, as compared to US$36.6 billion at the
2022 year-end, an increase of 12% driven by business growth and portfolio management
actions.
- Liquidity ratios are strong with LCR and NSFR at 317% and 123% respectively and liquid
assets to deposits ratio healthy at 51%.
- Capital ratios are strong: Tier 1 is at 15.2% comprising predominantly CET1 at 13.6% and
total Capital Adequacy Ratio (CAR) at 16.3%.
Bank ABC is a leading player in the region’s banking industry, with presence in 15 countries across
five continents. It provides innovative global wholesale banking solutions in both conventional
and Islamic finance, across Transaction Banking, Project and Structured finance, Capital Markets,
Financial Markets, Real Estate finance to corporates and financial institutions. It also provides
retail-banking services through its network of branches in Jordan, Egypt, Tunisia, Algeria, and
through ila Bank, its digital mobile-only bank, in Bahrain and Jordan.
The full set of the financial statements and the press release are available on the Bahrain
Bourse and Bank ABC’s website. Further details are explained in the Investor Highlights
Presentation published on Bank ABC’s website.
Mr. Saddek Omar El Kaber
