Ahli United Bank B.S.C. (AUB) reported a net profit of US$ 183.7 million for the nine month period ended 30 September 2009, compared to US$ 280.1 million for the same period in 2008.
The net profit for the third quarter ended September 2009 was US$ 40.1 million (Q3/2008 – US$ 68.4 million).
The Group was able to maintain core banking earnings through tight asset liability management and robust cost control measures. The Bank’s net interest income to 30 September 2009 showed an increase by 6% to US$ 343.6 million (YTD Q3/2008 – US$ 324.4 million), benefitting from improved liquidity conditions in the region as well as increased margins on its wholesale portfolio. The Bank’s focused efforts towards process efficiencies and cost control helped improve the cost to income ratio to 30.0 % as compared to 33.7% in 2008.
Conservative provisioning of US$ 196.1 million (YTD September 2008: US$ 58.8 million) was undertaken to ensure prudent mitigation of identified risks. Provisions on impaired Saudi corporate assets were increased to 75%.
Basic and dilutive earnings per ordinary share for the nine month period ended 30 September 2009, were US cents 3.8 respectively.
The Group’s resultant Return on Average Equity was 11.8%, while its Return on Average Assets was at 1.2 %.
As of 30 September 2009, the Group’s total assets stood at US$ 22.9 billion, a decrease of 3% over 31 December 2008, reflective of the Group’s focus on liability management, controlled risk stance and prudent portfolio selections. The loans and advances portfolio decreased by 5.4% to US$ 12.9 billion.
“This quarter too, as the earlier part of the year, continued to pose operating challenges given economic slowdown and larger provisioning requirements. We are however encouraged by the Bank’s resilience and strong fundamentals which have enabled it to navigate the regional ripple effects of the global economic slowdown and to effectively address all identified impairment challenges.”
“We are also encouraged by the recent re-affirmation of AUB credit ratings by S&P, Fitch and Capital Intelligence at A-, A-, A respectively with a Stable outlook, a very satisfactory result under the present difficult operating conditions.” said Fahad Al- Rajaan, Chairman, AUB.