Shamil Bank Member of the Board of Directors and Annual General Meeting Chairman, Mohammed A. Rahman Bucheerei said today that 2008 had proved, generally, a positive year for Shamil Bank.
Speaking following the Ordinary and Extraordinary Shamil Bank Annual General Meetings that were held at the Bank’s headquarters in Seef Tower, Bucheerei said that despite the financial crisis and the subsequent global economic slowdown, 2008 had been a busy year at Shamil Bank.
In February, following a meeting of Bank’s Board of Directors, Shamil Bank reported that it had made $66.8 million in total income, and a net profit of $22.8 million in 2008. It also reported high levels of liquidity, a particularly important fact in current conditions. Shamil Bank’s total assets also increased by 41 percent from $2 billion, as at 31 December 2007, to $2.9 billion as at 31 December 2008, and commodity Murahabas (bank placements) increased from $424 million, as at 31 December 2007, to $1.043 billion, as at 31 December 2008. At the end of 2008, the value of Shamil Bank’s Murabaha Financing also increased from $807 million, in 2007, to $1.048 billion. This significant increase is a reflection on the growing success of Shamil Bank’s core retail and corporate banking activities.
“It was our first full year of operations as a wholly-owned subsidiary of Ithmaar Bank, and the fact that we have been able to do so well in such a challenging year was made possible, in a large part, by the business diversity that exists within the Ithmaar group and the powerful synergies that have been subsequently created,” said Bucheerei. “This, in turn, sets the stage for our continued success, and we look forward to the challenges that lie ahead with a renewed sense of confident optimism,” he said.
“In 2008, the Shamil Bank Business Model changed completely, and the Bank re-structured its holdings,” said Bucheerei. “We doubled our 50 percent stake in Faisal Private Bank (FPB), the first Swiss bank exclusively dedicated to innovative wealth and asset management in accordance with the principles of Islamic finance, making it a wholly-owned subsidiary of Shamil Bank. We also acquired a 34 percent stake in Solidarity, one of the largest takaful (Islamic insurance) companies in the world,” he said.
“We also realigned our focus back to retail and corporate banking while continuing our investment banking activities, and launched a new business line, International Banking, which focuses on servicing large companies and government institutions in the GCC and MENA regions,” said Bucheerei. “This has created tremendous new opportunities with particularly low risk clients and an emphasis on trade finance related activities,” he said.
“Despite the financial crisis, Shamil Bank continued to take very seriously its commitment and responsibility to support the economic and social well-being of the communities in which it operates,” Bucheerei. “Accordingly, throughout 2008, we sponsored a number of key business, educational and Islamic banking initiatives, while also continuing our financial support for charitable, cultural, sporting and social organisations and events, and other worthwhile causes,” he said.
Shamil Bank Chief Executive Faisal Al Alwan said that, despite the testing global challenges of 2008, the Bank had been busy throughout the year.
“In addition to further increasing the number of branches and Automated Teller Machines, we have also improved our e-offerings, enhanced our business model and introduced new lines of business,” said Al Alwan. “With the start of 2008, on January 28, former Shamil Bank shareholders began to trade their Ithmaar Bank shares on the Bahrain Stock Exchange (BSE) following the successful completion of Ithmaar’s acquisition of Shamil. Shamil Bank, which became a wholly owned subsidiary of Ithmaar Bank in late 2007, retained its brand name,” he said.
“In 2008, we realigned our focus to retail and corporate banking operations - both of which are slated for rapid growth – and we continued to expand our investment banking activities,” said Al Alwan. “Meanwhile, the newly introduced International Banking business line includes the support and finance of credit documents, issuing guarantee letters for contractors as well as financing projects – and, to that end, we invested significant effort on further developing our relationships with governments, banks and financial regulators across the GCC and MENA regions. We have also focused our efforts on further developing our capabilities for foreign exchange trading as well as Money Market and interbank lending operations,” he said.
