Seera registers $2.3m net profit in first half

31/08/2015 08:01 AST

Seera Investment Bank, a Sharia-compliant investment bank headquartered in Bahrain, reported consolidated net income of $2.3 million for the six months ended June 30, compared with a loss of $29.5m for the same period last year.

The profit for the quarter ended June 30 was $1.6m compared with a loss of $1.7m for the same quarter last year. The increase in income is mainly attributed to fees on the acquisition and structuring of a new investment and exits from two investments.

Total assets of the bank as of June 30 stood at $198m and Seera’s balance sheet remained strong with a capital adequacy ratio of around 26 per cent and liquid assets of $34m.

“In line with the bank’s strategy, Seera has not only continued to extract value from its existing investments but also continued to grow its business through new transactions. During the first half of the year we have been successful in not only exiting from two investments but have also completed a new transaction. In February we successfully exited from the Sharia-compliant financing provided for the development of a UK student housing project in London and in June we finalised the sale process of Kosan Crisplant, a private equity investment in Denmark,” chief executive Abdulla Janahi said.

On Seera’s new business, Mr Janahi said “our recent investment in the development of dementia suffering elderly care homes in the UK was very well received in the market. The project will be developed on a 1.19 acre freehold site in Clapham, London, over a three to four-year period. The units are expected to be sold over the development period with distribution of substantially all the originally invested capital in the fourth year of investment together with a part of the profits. The investment over the holding period is expected to generate very attractive risk adjusted returns for Seera and its investors.”

On looking ahead Mr Janahi added: “Significant challenges remain in the global markets with slower than expected growth in the developed economies. However, according to general market consensus the underlying fundamentals in key economies continue to show positive momentum which will further benefit from low oil prices. With this in mind, Seera will, albeit with caution, continue to identify opportunities in its target markets. In this regard a number of investments are already in the pipeline and are expected to be completed during the next few months. In addition the bank will continue to opportunistically exit from certain existing investments and a number of such exits are in progress.”

Seera has investments in the industrial manufacturing and transportation sectors in addition to smaller investments in the utilities and real estate sectors. The bank’s investment strategy is to maintain a diversified investment portfolio geographically and industry wise, focusing on sectors underpinned by strong fundamental demand, and to avoid speculation driven sectors.

Gulf Daily News