AHLI UNITED BANK B.S.C. REPORTS A NET PROFIT OF US$ 450.6 MILLION AND A RETURN ON AVERAGE EQUITY OF 13.7% FOR THE NINE MONTHS ENDED 30 SEPTEMBER 2021
Ahli United Bank B.S.C. (AUB) reported a net profit attributable to its equity shareholders of US$ 152.1 million for Q3/2021, which represents a 31.2% increase over the Q3/2020 reported profit of US$ 115.9 million driven by an increase in net interest income and a lower level of net provision charge for credit losses. The Basic and Diluted Earnings per Share were US 1.5 cents in Q3/2021 versus US 1.1 cents in Q3/2020. Comprehensive income attributable to the owners of the bank for Q3/2021 was US$ 156.0 million (Q3/2020: US$ 129.7 million, +20.3%). Net interest income was US$ 222.5 million in Q3/2021 (Q3/2020: US$ 193.2 million, +15.2%) and total operating income was US$ 274.0 million in Q3/2021 (Q3/2020: US$ 247.4 million, +10.8%).
AUB reported a net profit attributable to its equity shareholders of US$ 450.6 million for the first nine months of year 2021 which represents a 10.1% increase over the YTD Q3/2020 reported profit of US$ 409.3 million mainly driven by an increase in net interest margins and a lower provision charge in 2021 given the exceptional incremental precautionary Stage 1 and Stage 2 ECL gross provision charges of US$ 78.4 million raised in YTD Q3/2020 on performing risk assets to address the heightened levels of macro-economic and sectoral risks following the out-break of the Covid-19 pandemic. The Basic and Diluted Earnings per Share in YTD Q3/2021 were US 4.3 cents, compared to US 3.9 cents in YTD Q3/2020. Comprehensive income attributable to the owners of the bank for YTD Q3/2021 was US$ 493.8 million (YTD Q3/2020: US$ 287.1 million, +72.0%). Net interest income for YTD Q3/2021 was US$ 644.2 million (YTD Q3/2020: US$ 599.9 million, +7.4%) primarily due to improved spreads, reduced liquidity premia and improving market conditions. Total operating income for the YTD Q3/2021 was US$ 826.2 million (YTD Q3/2020: US$ 823.0 million, +0.4%).
The Group’s equity attributable to owners at 30 September 2021 increased by 8.6% to US$ 4.3 billion (31 December 2020: US$ 4.0 billion). Return on Average Equity for YTD Q3/2021 increased to 13.7% (YTD Q3/2020: 12.7%). The AUB Group’s total assets as at 30 September 2021 increased by 3.6% to US$ 41.5 billion (31 December 2020: US$ 40.1 billion) reflecting prudent balance sheet growth compatible with the prevailing economic environment in its main operating markets. Return on Average Assets also improved to 1.6% for YTD Q3/2021 (YTD Q3/2020: 1.4%).
The non-performing loans ratio was lower at 2.5% (31 December 2020: 2.6%) with specific provision coverage of 82.2% (31 December 2020: 85.9%). Provision coverage levels are calculated on a cash provision basis excluding the value of the substantial additional non-cash (real estate and securities) assigned collaterals available against non-performing loans.
The cost to income ratio for YTD Q3/2021 was 29.0% (YTD Q3/2020: 28.6%) reflecting AUB’s efforts to enhance operational efficiencies through the roll-out of digitization initiatives as part of the AUB Group’s overall transformation plan.
The AUB Chairman, Mr. Meshal Al Othman, commented “Regional governments have conducted successful vaccination programs which ensured that the majority of their populations have been vaccinated. This facilitated proactive measured steps to ensure opening-up of local economies and return of customer confidence. However, the current period has also seen resurgence of Covid-19 virus variants in some other parts of the world with the resultant health situation adversely impacting business sentiment impacted by shortages of raw materials and components seriously affecting production levels in many key industries. As a result, global financial markets are still subject to volatility given the evolving developments and uncertainty.
Against the challenging backdrop of the still evolving market conditions, AUB achieved a very satisfactory performance in the first nine months of 2021 in terms of both financial and operational results”.
He added “During September 2021, AUB successfully completed a 5 year Senior Islamic Sukuk Issue and raised US$ 600 million as part of its funding base diversification efforts. The Sukuk issue was very well received and was subscribed over 2.5 times demonstrating AUB’s strong credentials and is listed on the London Stock Exchange”.
About Ahli United Bank (AUB)
Ahli United Bank B.S.C (AUB) is a leading pan-regional financial services provider, incorporated in Bahrain in May 2000. It offers a full range of retail, commercial and private banking & wealth management services, both conventional and Sharia-compliant, across the MENA region and the UK. AUB operates through its Bahrain Head Office and its subsidiaries in Kuwait, Egypt, Iraq, and the UK as well as its associates in Oman and Libya; and a branch in the UAE (DIFC).
The key shareholders of AUB are the Public Institution for Social Security, Kuwait (18.86% stake) and Social Insurance Organization, Bahrain (10.01% stake).
AUB’s strong performance has earned it a string of prestigious local and regional accolades over the years, including: “Best Bank in the Middle East” by The Banker (2006, 2016) and by Euromoney (2007, 2012) besides the “Best Bank in Bahrain” consistently over the years.