BankMuscat achieves net profit of RO 60.4 million, grows by 33%
BankMuscat (SAOG), the nation’s premier bank, has declared a net profit of RO 60.4 million for the year ended 31 December 2006, as against a net profit of RO 45.4 million for the year ended 31 December 2005, an increase of 33%. These results are subject to due approval by the shareholders and regulatory authorities.
Net interest income increased by 27.5% from RO 78.1 million in 2005 to RO 99.5 million in 2006. Non-interest income grew from RO 23.3 million in 2005 to RO 31.1 million in 2006, an increase of 33.5%. Operating profit of RO 77.3 million in 2006 is 34.9% higher than the RO 57.3 million achieved in 2005. Operating expenses of RO 53.3 million in 2006 are higher by 21% than RO 44.0 million incurred in 2005. The Cost to Income ratio for the year was at 40.8% as compared to 43.5% in 2005.
The return on average assets improved from 2.3% in 2005 to 2.4% in 2006. The return on average equity improved from 20.2% in 2005 to 21.9% in 2006. The basic earnings per share increased from RO 0.058 in 2005 to RO 0.073 in 2006, which works to be a return of 73% on a nominal value of a share.
The Bank’s net loans and advances portfolio grew by RO 463 million or 33.7% to RO 1,835 million as at 31 December 2006 compared to RO 1,372 million as at 31 December 2005. Customer deposits increased by RO 526 million or 40.7% to RO 1,817 million as at 31 December 2006 compared to RO 1,291 million as at 31 December 2005. Savings deposits increased by 26% from RO 338 million as at 31 December 2005 to RO 426 million as at 31 December 2006.
The Bank made loan loss provisions of RO 18.4 million during the year compared to RO 24.4 million made during the year ended 31 December 2005. Loan loss provision charge of RO. 18.4 million for the year 2006 includes RO. 8.9 million towards general loan loss provision as per the requirement of Central Bank of Oman. As of 31 December 2006, the Bank has fully met the general loan loss provision requirement of Central Bank of Oman. The Bank holds a general loan loss provision of RO 31.1 million as at 31 December 2006. During the year 2006, the Bank recovered RO 7.3 million from provision for possible credit losses compared to RO 15.9 million in 2005.
The Bank’s associates contributed RO. 4.1 million as share of profits during the year 2006 as against a RO. 3.7 million of 2005.
The Board of Directors pleased to recommend a cash dividend of 35% and stock dividend of 10% for the year 2006, subject to due approval by the shareholders and regulatory authorities, thus keeping up the practice of consistently providing good returns to shareholders.
About BankMuscat (SAOG)
With assets worth over US $ 7.7 billion, BankMuscat (SAOG) is the largest bank in Oman today with a strong presence in Corporate Banking, Retail Banking, Investment Banking, Treasury, Private Banking and Asset Management. The Bank has a network of 97 branches and over 200 ATMs in Oman and a representative office in Dubai (UAE). BankMuscat also has a strategic stake in Centurion Bank of Punjab, a private sector bank in India and BankMuscat International (BMI) an independent Banking entity that will be focused on becoming a truly GCC regional bank.
The international financial and banking community has lauded BankMuscat’s performance and pioneering efforts at setting new standards of excellence in the Banking industry in Oman and in the countries in which it operates across the region for several years now. BankMuscat holds the rare distinction of being voted the ‘Best Bank in Oman’ four times in a row by The Banker, FT London, six times by Euromoney and Global Finance Inc. The Bank was awarded the People Development Award at Oman Awards for Excellence, three years in a row.