Shamil Bank of Bahrain B.S.C., a leading Bahraini Islamic bank, listed on the Bahrain Stock Exchange has been assigned a 'BBB-' long-term and 'A-3' short-term counterparty credit ratings with a Stable Outlook by Standard & Poor's Ratings Services on 6th November, 2006, according to the Bank’s spokesperson.
The Investment Grade rating awarded to Shamil Bank reflects its good profitability, improving asset quality, and satisfactory capitalization.
Mr. Mohamed Hussain, Chief Executive, Shamil Bank has expressed that he is pleased with the ratings by Standard & Poor's, the world's foremost provider of financial market intelligence. Mr, Hussain added: “It reflects the consistent and robust financial performance of Shamil Bank. The impressive rating is a result of the successful implementation of the Bank’s strategic business plan.”
Standard & Poor’s has cited in its report that the Bank's profitability is high. ROA and ROE has increased steadily in the past five years and reached stellar levels of 4.9% and 25.3% for the first half of 2006. The Bank enjoys wide margins, expanding business volumes, and strong returns from its Pakistani affiliates. The rating agency has also noted that the Bank’s asset quality has rebounded over the past five years and is now on a par with peers'.
Standard & Poor's rating is based on principles of independence, integrity and disclosure - the same standards that underlie market confidence and acceptance of our ratings by investors worldwide. The rating process is open and clear at Standard & Poor's. The process remains consistent across different types of ratings and different markets.
The stable outlook reflects Standard & Poor’s expectation that Shamil will maintain its good financial performance and develop its retail franchise in Bahrain.
Mr. Mohamed Hussain, Chief Executive of Shamil Bank also thanked Standard & Poor’s analytical team and the Shamil Bank team who worked exceptionally well on the project which included facilitation of the processes involving among others, extensive quantitative, qualitative and legal reviews and analysis.
Shamil is an Islamic bank that was formed in 2000 from the merger of Bahrain-based Faysal Islamic Bank and Islamic Investment Company of the Gulf. Ithmaar Bank (not rated), also based in Bahrain, has a 60% ownership in Shamil and is committed to the Bank. Standard & Poor’s have not factored any specific support from Ithmaar into the ratings of Shamil, given the parent's developing financial profile.
Shamil Bank recently announced a record net income of US$ 50.2 million for the nine months ended 30 September 2006, reflecting an increase of 96 per cent over US$ 25.60 million earned in the same period last year. As a result, Earnings Per Share increased to US Cents 22 from US Cents 11 for the same period last year. Annualized Return on Equity also increased from 11.3 per cent to 19.7 per cent. The increase in net income is attributed to substantial growth in earnings from investment activities and income from funds under management.
Standard & Poor’s are world leaders in providing financial market intelligence, including independent credit ratings, indices, risk evaluation, investment research and data. An essential part of the world’s financial infrastructure, Standard & Poor’s has played a leading role for more than 140 years in providing investors with the independent benchmarks they need to feel confident about their investment decisions.
Note to the Editor:
Shamil Bank
Shamil Bank is a leading Islamic commercial and investment bank incorporated in the Kingdom of Bahrain. The Bank has grown steadily since 1982 to become a leading Islamic fainacial institution with a shareholding equity of US$ 342.4 million as at 30 September 2006.
The Bank provides a diverse range of products and services that cater to the financing and investment needs of individuals and instuitutions. It conducts its business in compliance with the principles of the Islamic Sharia’a.
Shamil Bank is a subsidiary of Ithmaar Bank B.S.C., a full service Islamic investment bank with a paid-up capital of US$360 million. Ithmaar Bank has a 60% shareholding in Shamil Bank.
Shamil Bank operates a network of local branches and maintains a presence in overseas markets through its subsidiary, associated and affiliated companies. Both Shamil Bank and it majority shareholder Ithmaar Bank are listed on the Bahrain Stock Exchange.
