AUB's net profit surges 30 per cent to $376.3m

28/10/2014 06:25 AST

Ahli United Bank (AUB) reported a net profit attributable to its shareholders of $376.3 million for the nine months ended September 30 this year.

This reflected an increase of 30.1 per cent over the core net profit of $289.3m achieved in the same period last year.

The overall result year-to-date at the end of the third quarter last year of $502.2m included an exceptional non-recurring gain of $212.9m from the sale of its 29.4pc stake in its Qatari affiliate.

The third quarter net profit achieved was $113.8m, a 14.8pc increase over the reported profit of $99.1m in the same period last year.

The basic earnings per share in the first nine months of this year were 6.3 cents, compared to five cents, excluding the exceptional gain, for the nine months ended in September last year.

The operating results of AUB were primarily driven by growth in its core operating earnings across its major markets.

During the period, the improvement in the net interest margin together with prudent growth in risk assets resulted in a 10.3pc increase in net interest income from $524.6m to $578.7m.

Diversified business initiatives and successful client acquisition initiatives contributed to a 4.5pc growth in fee income from $106.7m to $111.5m.

The cost-income ratio in the first nine months of this year improved to 28.4pc compared with 29.6pc in the same period last year, largely as a result of intelligent spend aligned to business needs without affecting the ability to efficiently service clients and to invest in future growth.

The group's total assets rose to $34.1 billion, an increase of 4.5pc over the December 31, 2013 position.

This increase was driven by a $1.4bn (+8.2pc) increase in the loan portfolio to reach $18.7bn by September 30, this year.

The growth in loan and advances was funded by an increase in customers' deposits to $24.4bn as at September 30 this year, compared with $22bn as at December 31 last year.

Asset quality remains solid with the non-performing loans ratio standing at 2.1pc (December 31, 2013: 2.3pc) while the specific provision coverage ratio improved to 91.5pc (December 31, 2013: 86.1pc).

The total provision coverage ratio, inclusive of collective impairment provisions, rose to 172.4pc as at September 30 this year (December 31, 2013: 155.5pc).

The AUB Group's return on average equity (ROAE) for the first nine months of this year increased to 15.9pc based on the improved operating results, compared to the operating ROAE, excluding the exceptional gain, of 14.2pc achieved in the prior period.

Return on average assets, calculated on the same basis, was also higher at 1.6pc for the first nine months of this year.

'AUB's diversification in its major operating markets and its continued success in expanding cross-border business flows between these markets have helped it achieve a robust growth in sustainable core operating revenues, while maintaining solid asset quality parameters,' chairman Fahad Al Rajaan said.

'AUB continues to seek opportunities, where viable, to expand its banking franchise further through value accretive organic or inorganic means.

'This entails a continuous, dynamic and focused approach to ensure the effective deployment of capital resources across the AUB Group's current and targeted markets,' he added.

Gulf Daily News