Ahli United Bank No Comments


Ahli United Bank B.S.C. (AUB) reported a net profit of US$ 65.7 million for the three month period ended 31 March 2010, a drop of 23.5% compared to the same period last year (Q/1 2009: US$ 85.9 million). This result represents a substantial rise of 284% over the trailing Q/4-2009 profit of US$ 17.1 million and reflects a strong improvement in core earnings net of exceptional items relative to the comparative period in 2009.

The Group’s net profit was achieved on the back of an increased net interest margin of 2.4% in Q1/2010 (Q/1 2009: 2.3% ) while prudently growing the loans and advances portfolio of US$ 13.6 billion by 2.3% over the 31 December 2009 balances of US$ 13.3 billion. This generated a net interest income of US$ 117.1 million (an increase of 9.4% over Q1 2009). The Group’s net interest margins have been sustained, underpinned by its focused asset liability management. The Q1/2010 results include a loan loss provision charge of US$ 51.8 million (Q/1 2009: US$ 47.0 million) which enabled the Bank to fully provide for its exposures to specific impaired Saudi corporate assets.

The Bank’s focused efforts on streamlined process efficiencies and cost control helped further contain its total operating expenses at US$ 58.9 million compared to US$ 60.4 million for the same period last year. The resultant cost income ratio for Q1/2010 was a low 31.9%.Basic and dilutive earnings per ordinary share for the three month period ended 31 March 2010, was US cents 1.3.

The Group’s total assets as of 31 March 2010 stood at US$ 24.7 billion, an increase of 4.7% over the US$ 23.6 billion reported at 31 December 2009, funded largely by a growth in customers’ deposits by 6.6% to US$ 14.1 billion over the US$ 13.2 billion as at 31 December 2009.

AUB also raised its stake in Ahli United Bank, Egypt (AUBE) from 35.3% to 79.6% through a path-breaking Mandatory Dual Tender Offer which was successfully concluded in January 2010. This transaction provided a unique opportunity for AUBE investors to sell their shares or to co-partner with AUB in its regional operations through a share and Lower Tier II subordinated debt

“2010 remains a challenging year, however we take comfort in the overall resilience demonstrated by the Bank in Q1/2010. It is gratifying to note our ability to maintain unwaveringly high counterparty and customers’ confidence at all times and to improve our core operating earnings.”, said Fahad Al- Rajaan, Chairman, AUB.

“In March this year, we have entered the promising Libyan market by way of a 40% stake acquisition in United Bank for Commerce and Investment L.S.C. We have also secured a ten year renewable Technical Services Agreement to provide management and technical services to this bank. This new market entry further demonstrates our commitment to our regional growth strategy applied in a phased and business justifiable manner”, added Mr. Al-Rajaan.