Arab Bank Group Reports Nine Months 2020 Net Profit of $215.2 Million
United Arab Emirates, 26 October 2020: Arab Bank Group reported net income after tax of $ 215.2 million for the nine months of 2020 as compared to $668.9 million for the prior period, recording a drop of 68%.
The fall in the profits is attributable to the build up of higher provisions, driven by current and forecasted economic conditions, and reflects the deterioration in the macro-economic environment in the region and globally, and to lower revenues from interest and fee income because of the impact of the Covid-19 outbreak and lower market interest rates and weakening oil prices.
Group net operating income is at $ 808 million, recording a drop of 22% from prior period as a result of a decrease in net interest and commission income, in addition to a drop in the profits of the bank’s associates in the Gulf. Customer deposits grew by 8% to reach $ 37.5 billion as compared to $ 34.7 billion, while loans grew by 2% to reach $26.7 billion as compared $ 26.1 billion. The Group maintained its strong and robust capital base with equity of $9.3 billion and with a capital adequacy ratio of 16.7% calculated in accordance with Basel III regulations. The Group enjoys high liquidity with a loan-to-deposit ratio of 71.1%, while credit provisions held against non-performing loans continue to exceed 100%.
Mr. Sabih Masri, Chairman of the Board of Directors remarked that the pandemic has had, and continues to have, a significant impact on businesses around the world.
Mr. Sabbagh, Chief Executive Officer, stated that the global and regional banking sectors will continue to face challenges because of the economic contraction, the higher cost of risk, and lower interest rates. He added that growth in the GCC countries has also declined sharply due to the plunge in oil prices.
Mr. Sabbagh highlighted that the increased provisions booked across the Group are in accordance with the guidelines of International Financial Reporting Standard # 9, and as per the bank’s internal expected credit loss model, and include general provisions built due to the current economic situation in Lebanon.
Mr. Masri concluded by stating that the pandemic has negatively affected the performance of banks throughout the region and globally and affirmed that Arab Bank Group will continue to maintain its strong and resilient financial position.
Posted by : Dubai PR Network Editorial Team Viewed 7174 times PR Category :Banking & Investments Posted on : Tuesday, October 27, 2020 10:04:00 AM UAE local time (GMT+4)
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