Final Results

 

TIDM89YE 
 
RNS Number : 6089M 
BBK (B.S.C.) 
02 February 2009 
 

 
 
BBK posts BD 27.1 million profit and maintains liquidity position above 25% of 
the total assets, with capital adequacy ratio above 20% 
 
 
 
 
The board of directors of BBK has met on Sunday 1st of February 2009 to review 
and approve the financial results for 2008. Mr. Murad Ali Murad, Chairman of the 
Board of Directors, announced that BBK posted a profit of BD 27.1 million 
compared to BD 30.0 million in 2007. In conformity with the norms in the 
industry, BBK has to prudently provide for provisions against certain financial 
assets to respond to the adverse conditions in the global financial markets. 
 
 
Besides the provisions of BD 46.9 million which have been taken against certain 
investments, all other core activities reported a positive trend compared to the 
previous year, resulting in profits from core business performance of BD 71.2 
million, a growth of 51.0%, if compared to 2007. Net interest income grew by BD 
6.4 million to reach BD 57.0 million, while non-interest income grew 
impressively by 78.1% to BD 54.9 million, mainly driven by investment income of 
BD 24.6 million, associated companies income of BD 3.2 million, foreign 
exchange income of BD 4.3 million, and income from fees and commissions of BD 
22.0 million. 
 
 
The bank has reported a net profit of BD 7.0 million for its 4th quarter 2008 
operations, compared to BD 4.3 million for the same period of 2007, mainly on 
the account of interest, and investment income. 
 
 
Although operating costs grew by 14.5% to accommodate the expense growth on 
account of the recent staff incentive initiatives, further expansion of core 
business activities and development of IT & premises infrastructure of the bank, 
operating costs to income ratio of the core business activities improved from 
37.8% in Dec 2007 to 31.5% in December 2008, which reflects the strong 
underlying growth of core business. 
 
 
After the opening of "City Centre" branch in October 2008, to improve service 
and outreach to retail customers, BBK has recently opened its "Cash Management 
Centre" at GOSI complex, as part of the bank policy to provide high class 
service to its corporate customers. The Cash Centre will offer Corporations, 
Small & Medium Enterprises, Government and Public Sector, and not-for-profit 
entities a complete over-the-counter cash management services such as funds 
transfers, deposits and encashment, through fully functional tellers. The bank 
has also upgraded its ATM base to be compatible with the smart chip, in 
compliance with regulatory requirements. Going forward, and as part of investing 
in customer service enhancement, BBK largest Financial Mall will be opened soon 
in West Riffa, along with three more financial malls in Isa Town, Hamad Town and 
Exhibition Road. 
 
 
The bank's balance sheet grew to BD 2,165 million, an increase of BD73 million 
when compared to December 2007. The increase resulted from a strong underlying 
business growth driven by the increase in net loans and advances by 20.1% to 
reach BD1,354 million. Customer deposits also has grown by 19.6% million to 
reach BD 1,337 million, despite signs of financial meltdown, reflecting the 
customers' confidence in the bank. 
 
 
As a result of following cautious and conservative approach to manage the 
liquidity risk, the bank maintains a very comfortable liquidity position with a 
liquid assets-to-total assets ratio above 25%, and a capital adequacy ratio 
above 20%, well above the regulatory requirements. 
 
 
Based on the above results, the Board of Directors has decided to recommend cash 
dividends of 20 fils per share, and 1 bonus share for every 20 shares held. 
 
 
Commenting on the Bank's results, Mr. Murad Ali Murad, Chairman, said 
"Notwithstanding the exceptional provisions we had to make during 2008, we are 
proud that the bank has achieved excellent core performance, in one of the most 
difficult years in the global financial markets". 
 
 
He also added "We are pleased that against the trend in the industry, ratings 
agencies have maintained the main rating elements of the bank. Fitch Ratings 
have maintained the Long Term IDR at A-, and the Short Term IDR at F2, while 
Moody's has affirmed its ratings except for the change in  A2 long-term foreign 
currency deposit outlook, from stable to negative, following the change in 
Bahrain rating ceiling on the same." 
 
 
Mr. A.Karim Bucheery, CEO, said "2008 was arguably the most traumatic year in 
global banking history, but we can look back on the period with quiet 
satisfaction. While many banks struggled for survival, BBK is in the enviable 
position of having achieved a good performance on behalf of shareholders. The 
Bank made substantial provision for impairments arising from the global 
financial crisis, which would have made 2008 results even more impressive" Also 
he said "The professionalism of employees at all levels and across every area of 
operations has shone through at all times, when their skills and resources were 
examined as never before". 
 
 
"Despite the uncertainties that still lie ahead, we are looking forward for the 
coming period with proactive strategies and business plans, where we will 
continue offering our valuable  customers the best world-class services in the 
financial industry", he added. 
 
 
 
 
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associated PDF document. 
 
 
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This information is provided by RNS 
            The company news service from the London Stock Exchange 
   END 
 
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