AUB reports net profit of $442.1 million for 9 months

Ahli United Bank BSC (AUB) reported a net profit attributable to its equity shareholders of $442.1 million for the nine months ended 30 September 2016, an increase of 5.5 percent as compared to $ 419.2 million achieved in YTD Q3/2015. The net profit achieved for the third quarter of 2016 was $ 140.9 million, similar to 2015 third quarter reported profit of US$ 140.9 million. The Basic Earnings per Share in YTD Q3/2016 increased to US 6.3 cents, from US 6.2 cents in YTD Q3/2015.

The growth in net profit of AUB was underpinned by the growth in its total assets to $ 35.8 billion (+5.3 percent) from $ 34.0 billion at 2015 year end. Net interest income grew by 2.5 percent from $ 604.8 million to $ 619.7 million. Fees, commissions & other income grew by 4.9 percent from $ 123.2 million to $ 129.3 million. As a result, net operating income increased by 5.2 percent to reach $ 763.7 million. With the continued application of our “intelligent spend” policy, operating expenses were contained at $ 235.1 million (+2.4 percent) resulting in a cost to income ratio of 28.3 percent (YTD Q3 / 2015: 27.5 percent).

Asset quality parameters continued to be healthy with a non performing loans ratio of 2.1 percent backed by a conservative total provision coverage ratio of 173.2 percent, inclusive of collective impairment provisions. With collaterals, the coverage ratio increased to 287.8 percent.

The Group’s Return on Average Equity (ROAE) for YTD Q3/2016 increased to 17.0 percent, based on improved operating results as compared to 16.7 percent achieved in the prior period. Return on Average Assets was higher at 1.9 percent for YTD Q3/2016 (YTD Q3/2015: 1.8 percent).

Hamad Al-Humaidhi, AUB Chairman, commented: “Despite tighter fiscal policy and weaker private sector activity resulting in lower liquidity in the banking system and moderate regional economic growth, AUB sustained its positive core performance trend in the first nine months of 2016. AUB’s growth is a testament to AUB’s well-managed business model based on diversification and cross border flows and of the success of its selective growth initiatives to increase profitability and mitigate risk challenges in its target markets.”

“In October 2016, the Ahli United Bank K.S.C.P., AUB’s subsidiary in Kuwait, successfully completed a $ 200 million issue of Additional Tier 1 Perpetual Basel III Compliant Sukuk. The Issue was well received in international markets with more than three times subscription. This also represents a clear testimony of the AUB Group’s strong credentials among prime international and regional investors as a well-managed, successful and creditworthy financial institution. AUB will continue to seek, identify and tap organic as well as inorganic growth opportunities within an acceptable riskreturn framework, “added Al-Humaidhi.