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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Islamic Bank | LSE:IBB | London | Ordinary Share | GB00B02KNV97 | ORD 1P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 1.425 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
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RNS Number : 7658D
Islamic Bank of Britain Plc
19 September 2008
ISLAMIC BANK OF BRITAIN PLC (the "Company")
Interim Results
Islamic Bank of Britain PLC (the "Company") is pleased to announce its interim results for the 6 month period ended 30 June 2008.
For further information please contact:
Gerry Deegan, Islamic Bank of Britain Plc
(tel: 0121 452 7300)
Gerald Beaney, Grant Thornton UK LLP (Nominated Adviser)
(tel: 020 7383 5100)
Chairman's Statement
I am pleased to present the Interim Report of Islamic Bank of Britain PLC for the six months ended 30 June 2008. This has been a period
where, despite adverse market conditions, the Bank continued to show steady growth in customer numbers, deposits and financing and to reduce
operating expenses compared to the same period last year.
Some performance highlights:
* Growth in customer numbers of 5.5%
* Growth in deposits of 7.2%
* Growth in customer financing of 13.3%
The operating loss for the half year was reduced by 21% to £3.1 million compared to the same period last year (6 month period ended 30
June 2007: £3.9 million). This was achieved through an increase in operating income of 22% to £2.6 million, and a 6% reduction in operating
expenses to £5.7 million.
Home Purchase Plan
On 1 July 2008, the Bank launched its Home Purchase Plan product. This product represents a major investment in the Bank's future and
will become a key product in the Bank's forthcoming marketing and sales initiatives.
The product follows the Bank's commitment to provide Sharia-compliant, innovative products, with the Home Purchase Plan being the only
product of its kind that allows customers to fully apply online. This extends the Bank's reach to customers nationwide. The technology used
in this flagship project will be utilised with other products in the Bank's existing, and forthcoming portfolio.
Other accomplishments
April 2008 saw the launch of the Bank's Wakala treasury deposit account, which has enjoyed a strong early performance whilst reducing
the costs of treasury transactions. The Direct Savings account also performed well during the period, following a successful marketing
campaign, increasing the Bank's diversified deposit base.
In addition to the Home Purchase Plan IT developments noted above, the Bank's IT infrastructure has been significantly upgraded since
the beginning of the year. This included construction of a new state-of-the-art data centre, providing enhanced security and capacity for
future growth, and upgrading the core banking platform, to improve performance and enable further upgrades.
The Smart Banking channels continue to grow, with the number of customers using online banking increasing 4% during the half year to
reach 28%, while the ratio of customers using automated telephone banking services advanced to 23.5%. This is in accordance with the Bank's
strategy to grow service delivery through efficient, user-friendly channels.
I would like to thank Islamic Bank of Britain's customers, shareholders, and staff for their continued support and commitment to the
Bank. I am encouraged by the progress we made in this challenging banking environment. I look forward to continued improvement and growth.
Mohsen Moustafa
Chairman
17 September 2008
Income Statement
for the 6 month period ended 30 June 2008
Note 6 month 6 month 6 month
period ended period period
30 June 2008 ended ended
30 June 31 Dec 2007
2007
£ £ £
Income receivable from Islamic 4,284,281 3,400,002 4,404,288
financing transactions
Returns payable to customers (1,859,492) (1,369,220) (1,839,651)
and banks
Net income from Islamic 2,424,789 2,030,782 2,564,637
financing transactions
Fee and commission income 250,843 124,207 115,855
Fee and commission expense (51,345) (7,746) (130,873)
Net fee and commission income 199,498 116,461 (15,018)
Operating income 2,624,287 2,147,243 2,549,619
Net impairment loss on 6 (180,277) (311,347) (332,724)
financial assets
Personnel expenses 4 (2,385,682) (2,395,095) (2,743,281)
General and administrative (2,244,490) (2,371,646) (1,607,346)
expenses
Depreciation (399,805) (383,753) (362,600)
Amortisation (473,869) (561,734) (544,340)
Total operating expenses (5,684,123) (6,023,575) (5,590,291)
Loss before income tax (3,059,836) (3,876,332) (3,040,672)
Income tax expense 4 - - -
Loss for the period (3,059,836) (3,876,332) (3,040,672)
Loss per ordinary share
Basic and diluted (pence) 3 (0.73) (0.93) (0.73)
Balance Sheet
At 30 June 2008
Note 30 June 2008 30 June 2007 31 Dec 2007
£ £ £
Assets
Cash 596,072 273,772 509,769
Commodity Murabaha and Wakala 146,747,433 119,745,351 141,768,471
receivables and
other advances due from banks
Consumer finance accounts and 6 9,262,838 9,249,857 9,663,295
other advances to customers
Net investment in commercial 8,523,880 5,386,012 6,091,882
property finance
Property and equipment 3,361,790 3,694,825 3,443,355
Intangible assets 912,938 1,431,447 1,262,231
Other assets 2,310,996 1,060,224 2,197,824
Total assets 171,715,947 140,841,488 164,936,827
Liabilities and equity
Liabilities
Deposits from banks 7 6,241,907 4,988,977 2,498,304
Deposits from customers 8 140,744,059 105,988,967 134,640,612
Other liabilities 2,930,263 2,008,589 2,972,602
Total liabilities 149,916,229 112,986,533 140,111,518
Equity
Called up share capital 4,190,000 4,190,000 4,190,000
Share premium 48,747,255 48,747,255 48,747,255
Retained deficit (31,188,401) (25,082,300) (28,137,072)
Profit stabilisation reserve 50,864 - 25,126
Total equity 21,799,718 27,854,955 24,825,309
Total equity and liabilities 171,715,947 140,841,488 164,936,827
These financial statements were approved by the Board of Directors on 17 September 2008 and were signed on its behalf by:
Gerry Deegan
Managing Director
The notes on pages 6 to 9 form part of these financial statements.
Statement of Changes in Equity
for the 6 month period ended 30 June 2008
Share Share Profit Profit stabilisation Total
capital premium and loss reserve
account account
£ £ £ £ £
Balance at 1 July 2007 4,190,000 48,747,255 (25,082,300) - 27,854,955
Loss for the period - - (3,040,672) - (3,040,672)
Credit in respect of share - - 11,026 - 11,026
based payments charge
Transfer to profit - - (25,126) 25,126 -
stabilisation reserve
Balance at 31 December 2007 4,190,000 48,747,255 (28,137,072) 25,126 24,825,309
Balance at 1 January 2008 4,190,000 48,747,255 (28,137,072) 25,126 24,825,309
Loss for the period - - (3,059,836) - (3,059,836)
Credit in respect of share - - 34,245 - 34,245
based payments charge
Transfer to profit - - (25,738) 25,738 -
stabilisation reserve
Balance at 30 June 2008 4,190,000 48,747,255 (31,188,401) 50,864 21,799,718
Cash Flow Statement
for the 6 month period ended 30 June 2008
Note 6 month 6 month 6 month
period period ended period
ended 30 June 2007 ended
30 June 31 Dec 2007
2008
£ £ £
Cash flows from operating
activities
Loss for the period (3,059,836) (3,876,332) (3,040,672)
Adjustments for:
Depreciation 399,805 383,753 362,600
Amortisation 473,869 561,734 544,340
Net impairment loss on 180,277 311,347 332,724
financial assets
Share Based Payment Charge 34,245 - 11,026
Change in Commodity Murabaha (7,682,833) (18,984,286) (19,081,574)
and Wakala receivables and
other advances due from banks
Change in consumer finance 220,180 (1,468,878) (746,162)
accounts and other advances to
customers
Change in net investment in (2,431,998) (3,047,611) (705,870)
commercial property finance
Change in other assets (113,172) (76,954) (1,137,600)
Change in deposits from banks 3,743,603 4,748,813 (2,490,673)
Change in deposits from 6,103,447 22,135,584 28,651,645
customers
Change in other liabilities (42,339) (178,672) 964,013
Net cash (used in)/from (2,174,752) 508,498 3,663,797
operating activities
Cash flows from investing
activities
Purchase of property, plant (318,240) (113,208) (111,130)
and equipment
Purchase of intangible assets (124,576) (98,909) (375,124)
Net cash used in investing (442,816) (212,117) (486,254)
activities
Net (decrease)/increase in (2,617,568) 296,381 3,177,543
cash and cash equivalents
Cash and cash equivalents at 5,664,506 2,190,582 2,486,963
beginning of period
Cash and cash equivalents at 5 3,046,938 2,486,963 5,664,506
the end of the period
Notes
(forming part of the financial statements)
1 Accounting policies and basis of preparation
Islamic Bank of Britain PLC ('the Company') is a company incorporated in the UK.
The annual financial statements of the Company are prepared in accordance with IFRSs as adopted by the EU. The interim financial
information included in this half-yearly report has been prepared in accordance with the recognition and measurement requirements of IFRSs
as adopted by the EU, applying the accounting policies and presentation that were applied in the preparation of the Company's published
financial statements for the year ended 31 December 2007. The directors anticipate that these accounting policies will be used in the
preparation of the Company's annual financial statements for the year ended 31 December 2008.
2 Segmental Reporting
The company has one class of business and all other services provided are ancillary to this. All business is conducted from the United
Kingdom.
3 Earnings per ordinary share
Basic and diluted earnings per ordinary share are calculated by dividing the loss for the financial period attributable to equity
shareholders by the weighted average number of ordinary shares in issue in the 6 month period ended 30 June 2008 of 419,000,000 (6 month
period ended 30 June 2007: 419,000,000, 6 month period ended 31 December 2007: 419,000,000).
The Company has established an HMRC approved Company Share Option Plan ('CSOP') under which options to subscribe for the Company's
ordinary shares of 1p each have been awarded to certain employees. At 30 June 2008 3,200,469 options remain outstanding (30 June 2007: nil,
31 December 2007: 3,200,469). Diluted loss per share is the same as basic loss per share since the outstanding share options have not been
taken into account due to their anti-dilutive effect. This arises since the Company is currently loss making.
4 Income tax expense
There were no taxable profits or recoverable losses for the 6 month period ended 30 June 2008 (6 month period ended 30 June 2007: £nil,
6 month period ended 31 December 2007: £nil) and, accordingly, the Company has not provided for a tax charge or a tax debtor.
As at 30 June 2008, the Company had potential deferred tax assets in respect of tax losses carried forward of £6,855,212 (30 June 2007:
£5,234,252, 31 December 2007: £6,156,185) and in respect of timing differences on capital allowances of £1,251,716 (30 June 2007:
£1,218,045, 31 December 2007: £1,147,840).
In respect of the recognition of deferred tax assets, for the purposes of applying the requirements of IAS 12 ('Income Taxes'), it has
been considered that the Company is not currently at a sufficiently advanced stage in its development to confidently assert future
offsetting tax liabilities. The capital allowances to be claimed are being finalised and therefore the level of the potential asset shown
above may change.
The corporation tax rate used to calculate potential deferred tax assets was 28%.
5 Cash and cash equivalents
30 June 2008 30 June 2007 31 Dec 2007
£ £ £
Cash 596,072 273,772 509,769
Other advances to banks 2,450,866 2,213,191 5,154,737
Total cash and cash 3,046,938 2,486,963 5,664,506
equivalents
6 Impairment allowance
30 June 2008 30 June 2007 31 Dec 2007
£ £ £
Specific allowances for
impairment
Balance at beginning of period 194,309 357,081 89,602
Transfer to collective - (302,938) -
allowances for impairment
Charge for the period 50,373 35,459 104,707
Amount written off during the (112,825) - -
period
Balance at end of period 131,857 89,602 194,309
Collective allowances for
impairment
Balance at beginning of period 818,708 140,076 718,902
Transfer from specific - 302,938 -
allowances for impairment
Charge for the period 129,904 275,888 228,017
Amounts written off during the (86,166) - (128,211)
period
Balance at end of period 862,446 718,902 818,708
Total allowances for
impairment
Balance at beginning of period 1,013,017 497,157 808,504
Charge for the period 180,277 311,347 332,724
Amount written off during the (198,991) - (128,211)
period
Balance at end of period 994,303 808,504 1,013,017
This impairment allowance relates to consumer finance accounts and other advances to retail customers.
Following a review of the impairment calculation during the 6 month period ended 30 June 2007, a transfer was made from the specific
allowance to the collective allowance, as shown in the table above.
7 Deposits from banks
30 June 2008 30 June 2007 31 Dec 2007
£ £ £
Repayable on demand 6,175 246,092 14,820
3 months or less but not 6,000,000 4,742,885 2,247,752
repayable on demand
1 year or less but over 3 235,732 - 235,732
months
Total deposits from banks 6,241,907 4,988,977 2,498,304
Comprising:
Non profit sharing 6,000 6,000 6,000
Profit sharing/paying accounts 6,235,907 4,982,977 2,492,304
Total deposits from banks 6,241,907 4,988,977 2,498,304
8 Deposits from customers
30 June 2008 30 June 2007 31 Dec 2007
£ £ £
Repayable on demand 87,885,144 66,754,673 77,626,003
3 months or less but not 43,097,222 23,500,047 47,586,495
repayable on demand
1 year or less but over 3 months 9,761,693 15,734,247 9,428,114
Total deposits from customers 140,744,059 105,988,967 134,640,612
Comprising:
Non profit sharing 26,237,158 22,027,110 27,094,505
Profit sharing/paying accounts 114,506,901 83,961,857 107,546,107
Total deposits from customers 140,744,059 105,988,967 134,640,612
9 Related party disclosures
Transactions with directors
Mr Shabir Randeree resigned as a director of the Company on 6 February 2008. During the current and comparative periods, Mr Shabir
Randeree was a director of the following companies that held bank accounts with Islamic Bank of Britain Plc under normal customer terms and
conditions.
* As at 6 February 2008, Pelham Incorporated Limited deposit balances amounted to £86,341 (30 June 2007: £1,719,881, 31 December 2007:
£622,949) and the highest balance during the period to 6 February 2008 was £625,602 (30 June 2007: £6,626,311, 31 December 2007:
£1,749,887). Returns paid on these deposits during the period to 6 February 2008 totalled £2,654 (30 June 2007: £52,030, 31 December 2007:
£13,121). As at 30 June 2008, the deposit balances amounted to £635,563.
* As at 6 February 2008, DCD Properties Limited deposit balances amounted to £2,048 (30 June 2007: £84,400, 31 December 2007: £86,543)
and the highest balance during the period to 6 February 2008 was £87,173 (30 June 2007: £526,291, 31 December 2007: £86,453). Returns paid
on these deposits during the period to 6 February 2008 totalled £391 (30 June 2007: £1,644, 31 December 2007: £2,143). As at 30 June 2008,
the deposit balances amounted to £2,048.
* As at 6 February 2008, European Islamic Investment Bank PLC deposit balances amounted to £244,552 (30 June 2007: £240,092, 31 December
2007: £244,552) and the highest balance during the period to 6 February 2008 was £244,567 (30 June 2007: £5,284,929, 31 December 2007:
£244,552). Returns paid on these deposits during the period to 6 February 2008 totalled £15 (30 June 2007: £53,483, 31 December 2007:
£4,460). As at 30 June 2008, the deposit balances amounted to £235,907.
At 30 June 2008, directors of the Company and their immediate relatives controlled 0.04% of the voting shares of the Company (30 June
2007: 7.41%, 31 December 2007: 7.21%).
Transactions with key management personnel
Key management of the Company are the Board of Directors and Management Committee members. The compensation of key management personnel,
including the directors, is as follows:
6 month 6 month 6 month
period period period
ended ended ended
30 June 30 June 31 Dec
2008 2007 2007
£ £ £
Key management emoluments including 788,216 586,638 477,717
social security costs
Company contributions to pension plans 21,950 17,450 21,530
Total 810,166 604,088 499,247
Deposit balances, operated under standard customer terms and conditions, held by key management personnel, including directors, totalled
£162,379 as at 30 June 2008 (30 June 2007: £157,049, 31 December 2007: £116,664). The highest balance during the 6 month period ended 30
June 2008 was £279,043 (6 month period ended 30 June 2007: £233,445, 6 month period ended 31 December 2007: £143,305). Total returns paid on
these accounts for the 6 month period ended 30 June 2008 totalled £1,664 (6 month period ended 30 June 2007: £724, 6 month period ended 31
December 2007: £220).
Outstanding consumer finance account balances relating to key management personnel, including directors, totalled £63,638 as at 30 June
2008 (30 June 2007: £19,874, 31 December 2007: £51,994). Returns recognised on these accounts for the 6 month period ended 30 June 2008
totalled £1,941 (6 month period ended 30 June 2007: £683, 6 month period ended 31 December 2007: £1,721). All consumer finance account
facilities taken by key management personnel and directors were offered in line with standard customer terms and conditions.
10 Interim Report and statutory accounts
The comparative figures for the financial year ended 31 December 2007 are not the company's statutory accounts for that financial year.
Those accounts have been reported on by the company's auditors and delivered to the registrar of companies. The report of the auditors was
(i) unqualified, (ii) did not include a reference to any matters to which the auditors drew attention by way of emphasis without qualifying
their report, and (iii) did not contain a statement under section 237(2) or (3) of the Companies Act 1985.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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