Bahrain Islamic Bank Achieves a Net Profit of BHD11.4 Million for the Year 2018

Bahrain Islamic Bank (BisB) reported that it has recorded a net profit of BHD 11.4 million for the year ended December 31, 2018, compared to BHD 10.1 million net profit in the last year; an increase of 12.2 %. The Bank has also recorded BHD 4.5 million net profit during the last quarter of 2018, compared to BHD 4.7 million net profit during the same period in the last year, a decrease of 4%.

Dr. Esam Abdulla Fakhro, Chairman of the Board of Directors, said that in the fiscal year ended December 31, 2018, the Bank achieved a net operating income of BHD 20.3 million, compared to BHD 16.3 million last year, an increase of 24.1%. The net operating income increased to BHD 7.6 million for the fourth quarter of 2018 compared to BHD 3.3 million for the same period last year, an increase of 128 %.  He added that the Board of Directors of the Bank has decided to take net impairment provisions during this year amounting to BHD 8.9 million, compared to BHD 6.2 million, last year.

Fakhro added that the Bank achieved a total operating income of BHD 45.5 million for the year ending on 31st December 2018 compared to BHD 42.9 million for the same period last year, an increase of 6.1 %. The total operating income for the fourth quarter of 2018 amounted to BHD 14.2 million compared to BHD 10.3 million for the same period of last year, an increase of 37.8%. Also, the net provisions charge amounted to BHD 3.1 million for the last quarter of 2018 compared to net impairment release of BHD 1.3 million, for the same period last year. Moreover, The Bank recorded a total income from jointly financed assets for the year ended December 31, 2018 of BHD 53.9 million compared to BHD 47.3 million for the same period of last year, an increase of 14%. The total income from jointly financed assets for the fourth quarter of 2018 amounted to BHD 14 million compared to BHD 12.9 million for the same period of last year, an increase of 8.8%.  

The Chairman of the Board of Directors announced on the Sunday’s press release issued by the Bank, the Board's approval of the financial statements for the financial year ended 31 December 2018, which reflected the improvement in the Bank's financial performance and its positive results indicating the success of the Bank's strategy.

Fakhro pointed out that the positive results achieved by the Bank during the last year confirmed the strength of the Bank’s financial position and the good liquidity ratios attained. He pointed out that the Bank's management remains cautious in providing transactions and financing to customers, which could adversely affect the Bank's financial performance.

Mr. Hassan Amin Jarrar, Chief Executive Officer of the Bank, praised the Bank's positive financial results in 2018, which has reflected the success of the Bank's “Ishraq - Back to Basics” strategy, in the last year, which achieved the desired objectives of the Bank at all levels.

Mr. Jarrar explained that the Bank has continued its reliance on revenues and fees from its financing and core Banking activities, which represent the majority of the bank’s total income, in addition to our ongoing efforts to expand the Bank's customer base by providing various products and services that meet their requirements. He added that Islamic finance in the Bank has increased by 3.4%, coupled with a rise in current accounts of 1.2% compared to 2017. However, the cost of deposits has surged by 39.3% from the last year. He further remarked that the Bank is enjoying a significant Liquid Assets to Total Assets ratio stands at 15.9% and a Capital Adequacy ratio of 17.11%. Earnings per share have also increased to 10.83 fils for the year ending on 31st December 2018 compared to 9.65 fils for the same period last year. Earnings per share have marginally decreased to 4.29 fils for the fourth quarter of 2018 compared to 4.47 fils for the same period last year. Total shareholders’ equity stands at BHD 117.7 million as of December 31 2018 compared to BHD 122.3 million as of December 31 2017, a decrease of 3.7%. Also, total assets increased by 4.1% to BHD 1.28 billion from BHD 1.23 billion.

Mr. Jarrar said that the Bank is still in the process of disposing its non-yielding assets and reducing its non-performing facilities. This will require more time and effort to enhance the Bank's asset management with the best available means.

He pointed out that the year 2018 was not free of economic challenges and difficult political conditions in the region. Nevertheless, the Bank has succeeded to realize many achievements and developments through it’s’ "Ishraq – Back to Basics” strategy along with the efforts and loyalty of the Bank’s employees, at all levels of their career.

The CEO remarked that, in 2018, the Bank offered a range of promotions for the Bank's various products and services such as investment accounts, credit cards, personal and mortgage financing, and more. In addition to signing a number of agreements and memorandums of understanding with strategic partners, inside and outside of the region; it re-launched the Thuraya Private Banking Account, with a new set of unique features along with the “BisB Rewards” system to its loyalty credit card and prepaid customers. The Bank also opened a new digital branch at Galleria Mall, located in Zinj; to provide various types of banking services using the latest digital technology as part of its aim to enable its customers to complete various Banking transactions electronically in the shortest possible time.

Mr. Jarrar expressed his delight at the launch of the website and electronic application of e-banking services for the Bank's customers along with the inauguration of the Bank's Innovation Lab, which avails an innovative working environment that encourages the generation of new ideas. The lab also enables the Bank’s new products and services to be tested before they are introduced to the market; in line with the Bank's commitment to driving digitization and encouraging digitization in order to serve its customers with the latest technology.

In addition, the Chief Executive Officer noted that the Bank's Human Resources sector has launched “SAP-Success Factors” system, which provides an integrated set of solutions that manage human resources operations more easily and simplifies organizational management procedures so that employees can effectively perform their daily tasks.

The Bank is keen to strengthen its administrative staff with qualified human cadres and to provide opportunities for outstanding current cadres. Mr. Jarrar announced that during the past year, the Bank has appointed a new Head of Compliance and Governance to develop the Bank's Corporate Governance and Compliance Department, in addition to promoting Bahraini employees from its current staff, including the post of Chief Financial Officer; in addition the first female roles Head of Central Operations and Head the Shari'a Supervisory Department at BisB.

Mr. Jarrar  praised the Bank's graduation last year, the first batch of its employees participating in various training programs in cooperation with Tamkeen and other partners specialized in training and developing human resources, during a ceremony organized under the patronage of the Minister of Labor and Social Development. He also highlighted the Bank's success in organizing several programs and training courses for its employees at various levels of management and in many areas with the aim of refining and developing their work skills.

Within the framework of the Bank's interest in supporting the banking industry and educating employees in the Banking sector, the Chief Executive Officer added that the Bank has successfully organized the second forum to introduce Islamic Banking operations, which attracted members of Shari'a Supervisory Boards, Islamic Banking specialists, lawyers, legal advisors and arbitrators to discuss the most important issues related to Islamic banking. He mentioned the Bank's continued sponsorship of Shari'a conferences organized by the AAIOFI and the World Islamic Banking Conference.

The CEO also expressed his pleasure that the Bank received in 2018 a number of prestigious awards; Most Innovative Islamic Bank Of Bahrain Award for the year 2018 awarded by the International Finance Magazine, Best Online Bank in the Kingdom of Bahrain for the year 2018 awarded by the UK's Global Business Outlook and the Corporate Governance and Corporate Social Responsibility Award of 2018 from the World Islamic Banking Conference.

In conclusion, the Chairman and Chief Executive Officer of the Bank expressed their thanks and appreciation to the Board of Directors for their continuous support to the Executive Management Team, and to all Bank employees for their efforts and dedication. And to the shareholders and the customers who have chosen our Bank to conduct all their Banking transactions. We look forward to the year 2019 being a year of success and achievements that contribute to maintaining the Bank's position and commensurate with its history and leading position.