Khaleeji Commercial Bank (Trading Code: KHCB) has announced its Q4 2020 financial results, reporting a total net profit Attributable to the Bank's Shareholders of BD 209 thousand, compared to BD 9.7 million loss in the same period in 2019. Earnings per share reached 0.26 Fils, compared to -12.09 Fils for the same period of the previous year.
Fourth quarter total income increased by 34.8% compared to Q4 2019, from BD 5.04 million to BD 6.79 million. Profit before impairment allowances for the fourth quarter increased by 1740.3% to BD 4.06 million, compared to BD 221 thousand in Q4 2019.
The Bank has attained net profit of BD 7.9 million attributable to the Bank's shareholders for the fiscal year ended 31st December 2020, compared to a net loss of BD 15.0 million for the same period of the previous year.
The increase in net profits is mainly attributed to the Bank's reporting of an increase in total income to reach BD 22.6 million, compared to BD 19.6 million in 2019, an increase of 15.8% in addition to the decrease in total expenses and total provisions compared to last year.
Earnings per share reached 9.94 Fils, compared to -18.56 Fils for the same period of the previous year. Profit before impairment allowances has increased by 128.4% to BD 12.2 million, compared to BD 5.4 million in 2019.
Total shareholders' equity has increased by 65.5% to BD 141.8 million in 2020, in comparison with BD 85.7 million in 2019. Meanwhile, the total growth in the Bank's assets was recorded at 8.1%, reaching BD 1015.6 million, compared to BD 939.8 million in 2019, while the Bank was able to achieve growth in its liquid assets, which currently constitute 24.41% of total assets, while capital adequacy has reached 20.31%.
Additionally, the Bank maintains a healthy liquidity coverage ratio of 198.28% and a net stable funding ratio of 103.65% for the fiscal year ending 31st December 2020. Income attributed to shareholders has reached 7.02% and the income attributed to assets reached 0.81%, allowing the Bank to invest in liquidity through distinguished investments in 'Sukuk', characterised by high income and low risks. These investments resulted in a noticeable increase in the 'Sukuk' portfolio, reaching BD 261.1 million in 2020, compared to BD 195.1 million in 2019, with a growth of 33.9%.
Commenting on the financial results, Mr. Jassim Alseddiqi, Chairman of KHCB's Board of Directors, said 'The Bank has recorded a remarkable performance despite the uncertainty the global market scene is witnessing. The Bank is equipped to face these challenges where it successfully achieved growth and progress during the year. Strong foundations were laid for this strategy by issuing Sukuk worth BD 60 million as Additional Tier 1 'AT1' Capital and reached an agreement to exchange Financial and Investment Assets worth BD 46.4 both of which were signed with GFH Financial Group. These agreements were an integral part of the Bank's strategy in paving the path towards success and the unwavering steps towards achieving a strong foundation and success.'
Stating further, Mr. Alseddiqi said: 'The Kingdom's economic climate played an important role in protecting all sectors, including the Banking and Finance Sectors from the negative impacts of the pandemic. This was done thanks to the almighty God first, then to the preventive decisions and measures taken by the Government's Executive Committee and The National Task Force for Combating the Corona Virus that contributed to the continuation of economic activity and enabled companies and institutions to continue growing and generate profits.'
'We trust that the Bank will continue its growth by applying its flexible strategy that is capable of adapting to various regional and international variables imposed by COVID-19 Pandemic, and the accompanying financial and economic repercussions. The Board of Directors shall spare no effort in providing the necessary support to the Executive Management in achieving sustainability, reinforcing profitability, and attaining remunerative returns for the shareholders.' Mr. Alseddiqi added.
For his part, Mr. Sattam Algosaibi, Chief Executive Officer of KHCB said 'In 2020, the Bank has been able to achieve the strategic goals present by its Board of Directors, based on providing innovative financial solutions, quickly responding to market changes, and understanding the needs and requirements of clients, especially with regard to procedures and facilitations provided by the bank and under the direction of the Central Bank of Bahrain to mitigate the negative effects resulting from the spread of the Coronavirus, including the deferment of finance instalments, raising the maximum limit for credit cards and debit cards, and supporting companies and SMEs. The Bank has recorded a positive indicator in its performance, attaining net profit of BD 7.9 million attributable to the Bank's shareholders. Despite the current challenges, the Bank was able achieve a growth in its total assets, while capital adequacy has reached 20.31%, and the Bank has maintained a liquidity coverage ratio of 198.28%, and a net stable funding ratio of 103.65% for the fiscal year ending on 31st December 2020.'
Mr. Algosaibi added: ' The Bank will invest its improved financial position towards enhancing the financing portfolio for individuals and companies, investing in Sukuk, and continuing the work on implementing the Bank's strategic plan towards digital transformation at an accelerated pace with confidence to implement the latest technology introduced to banking services, and to develop an integrated set of innovative technological banking solutions. KHCB is also striving to enhance its client service quality, and to introduce banking solutions and services that meet the diverse aspirations of our clients, individuals and corporates alike.'
KHCB is a leading Islamic bank that strives to achieve clients' aspirations through an Islamic banking model that offers a comprehensive range of high quality Shari'a-complaint banking services and investment opportunities to individuals and companies.
The press release and the full audited financial statements are available on Bahrain Bourse website.