The Muscat-based National Bank of Oman (NBO) has reported that it was forced to increase its loan loss provision in 2000, raising the amount by 36.9 percent from RO 7.65 million in 1999 to RO 10.47 million in 2000, reported the Oman Daily Observer.
The higher loan loss provision, the bank said in a statement, led to a 22 percent cut in net profits—down to RO 8.3 million in 2000—from RO 10.7 million in 1999. The NBO was however able to recommend a 15 percent cash dividend.
One of the main reasons for the expanded loan loss provision was default in loan repayment by major corporate clients. The single largest provision was in Egypt for RO 495,000 against an old named food manufacturing company.
Still, Egypt remains a successful market for the bank. Some17 percent of its operating income and 24 percent of net profit in 2000 came from operations in its three Egyptian branches. – (Albawaba-MEBG)
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