KD 81.6 mil­lion net profit for KFH share­hold­ers in H1 2017

Prof­its af­firms suc­cess­ful strat­egy of fo­cus­ing on Core Bank­ing Busi­ness

Kuwait Times - - BUSINESS -

Chair­man of Kuwait Fi­nance House (KFH) Ha­mad Ab­dul­mohsen AlMar­zouq said that “KFH has, by the grace of Al­lah, re­al­ized a KD 81.6 mil­lion net profit for the first half of 2017 for KFH share­hold­ers com­pared to KD 70.9 mil­lion for the same pe­riod last year i.e. an in­crease of 15.2%. Net fi­nance in­come for H1 this year reached KD 210.8 Mil­lion i.e. a growth of 2.7% com­pared to the same pe­riod last year. To­tal oper­at­ing in­come for the first half of this year reached KD 343.2 mil­lion, i.e. a growth of 9.1% and net oper­at­ing in­come reached KD 200.3 mil­lion, i.e. a growth of 22.1% com­pared to the same pe­riod last year.

To­tal oper­at­ing ex­penses for the pe­riod de­creased by KD 7.5 mil­lion, i.e. a de­crease of 5% over the same pe­riod last year. Earn­ings per share for the first half of 2017 reached 14.37 fils, com­pared to 12.49 fils for the same pe­riod last year i.e. an in­crease of 15.1%. To­tal As­sets reached KD 17.165 bil­lion i.e. an in­crease of KD 666.1 mil­lion or 4% com­pared to end of year 2016.

Fi­nance port­fo­lio reached KD 8.914 bil­lion i.e. an in­crease of KD 738.5 mil­lion or 9% com­pared to end of year 2016. De­pos­i­tors’ ac­counts reached KD 11.377 bil­lion i.e. an in­crease of KD 714.9 mil­lion or 6.7% com­pared to end of year 2016. Share­hold­ers’ eq­uity reached KD 1.795 bil­lion at the end of the first half of 2017. In ad­di­tion, KFH’s cap­i­tal ad­e­quacy ra­tio (CAR) reached 17.55%, higher than the re­quired limit of 15%, thus re­it­er­at­ing the strength of KFH fi­nan­cial po­si­tion.

Sus­tain­able prof­itabil­ity

Al-Mar­zouq ex­plained that the re­al­ized prof­its are at­trib­uted to the ef­fi­cient ex­e­cu­tion of the bank’s strat­egy by fo­cus­ing on the core bank­ing busi­ness while achiev­ing sta­ble and sus­tain­able growth across the Group banks in var­i­ous coun­tries in­clud­ing Turkey, Bahrain, Malaysia, Ger­many, and oth­ers. The prof­its af­firm that KFH is on the right track achiev­ing sus­tain­able prof­itabil­ity, strength­en­ing its cap­i­tal base, while main­tain­ing its pi­o­neer­ing po­si­tion as a global lead­ing Is­lamic fi­nan­cial in­sti­tu­tion. The in­ter­na­tional op­er­a­tions are char­ac­ter­ized by the ge­o­graphic di­ver­sity that con­trib­utes to im­prov­ing the as­set qual­ity and prof­itabil­ity.

De­spite the chal­leng­ing oper­at­ing en­vi­ron­ment in the do­mes­tic and in­ter­na­tional mar­kets, KFH proved re­silience in its busi­ness model through op­ti­mal in­te­gra­tion of its units and ac­tiv­i­ties, ef­fi­cient risk man­age­ment, and the abil­ity to soundly deal with the eco­nomic chal­lenges and com­ply with the reg­u­la­tory re­quire­ments. KFH con­stantly en­deav­ors to im­prove its as­set qual­ity while con­tin­u­ing its pru­dent pol­icy in set­ting aside pro­vi­sions in light of the eco­nomic un­cer­tainty. This leads to im­prov­ing the Cap­i­tal Ad­e­quacy Ra­tio while strength­en­ing the bank’s fi­nan­cial po­si­tion.

Al-Mar­zouq said that Moody’s In­vestors Ser­vice (Moody’s) has af­firmed KFH’s A1 long-term de­posit rat­ings, and changed the out­look on th­ese rat­ings to sta­ble from neg­a­tive. He added, as per Moody’s re­port, KFH is one of the largest banks in Kuwait with a mar­ket share ex­ceed­ing 20% of the as­sets of the Kuwait bank­ing sec­tor, in­di­cat­ing KFH’s rat­ings re­flect the re­sult of im­prove­ments in its fi­nan­cial per­for­mance, high lev­els of liq­uid­ity, and the strong cap­i­tal­iza­tion that is im­prov­ing in com­par­i­son to its peers lo­cally and glob­ally.

Al-Mar­zouq high­lighted the im­por­tance of fi­nanc­ing the coun­try’s mega pro­jects, con­sid­er­ing this as an eco­nomic, de­vel­op­ment and so­cial goal. He em­pha­sized KFH’s com­mit­ment to­wards cor­po­rate fi­nance as per the credit and leg­isla­tive reg­u­la­tions, in­di­cat­ing the bank’s un­remit­ting ef­forts to of­fer credit fa­cil­i­ties for SMEs where it has the largest share of SMEs seg­ment.

He re­it­er­ated KFH-Group’s sig­nif­i­cant role in strength­en­ing Sukuk prod­uct as a prime fi­nanc­ing in­stru­ment for gov­ern­ments and cor­po­rates across the global mar­kets, es­pe­cially in light of the in­creas­ing ac­cept­abil­ity of this shari­a­com­plaint prod­uct, that of­fers fi­nanc­ing for cor­po­rates, de­vel­op­ment and in­fra­struc­ture pro­jects, and for ur­ban de­vel­op­ment to achieve fur­ther growth and ex­pan­sion. KFH is a pi­o­neer in is­su­ing sovereign Sukuk across the world. Re­cently, KFH Cap­i­tal, a fully owned sub­sidiary of (KFH-Group) suc­cess­fully par­tic­i­pated in Hong Kong USD1bn Sovereign Sukuk as a co-man­ager and act­ing as a joint lead man­ager and a book run­ner for the USD 1 bil­lion bench­mark Sukuk is­sue for Dubai Is­lamic Bank (DIB).


Al-Mar­zouq con­tin­ued: KFH won sev­eral awards in recog­ni­tion of its ex­cel­lence and lead­er­ship role on dif­fer­ent lev­els. KFH won “Is­lamic Bank of the Year 2017- Kuwait”, “Is­lamic Bank of the Year 2017- Mid­dle East” and “Is­lamic Bank of the Year 2017- Global” awards from “The Banker” mag­a­zine. The bank won “Top Listed In­sti­tu­tion in Kuwait 2017” award from “Forbes Mid­dle East” mag­a­zine in recog­ni­tion of in­stru­men­tal role in boost­ing eco­nomic growth. Also, KFH won two pres­ti­gious awards from the Kuwait Pub­lic Re­la­tions As­so­ci­a­tion. The awards are: In­sti­tu­tional Ex­cel­lence in Pub­lic Re­la­tions award, and Ex­cel­lence in So­cial Aware­ness award.

KFH plays a key role in sig­nif­i­cant eco­nomic events. The bank spon­sored the Kuwait Fi­nan­cial Fo­rum held un­der the pa­tron­age of H.H. the Amir Sheikh Sabah Al-Ah­mad Al-Jaber Al-Sabah. KFH or­ga­nized the 9th fo­rum for Listed Com­pa­nies and Fi­nan­cial An­a­lysts aim­ing at dis­cussing the lat­est de­vel­op­ments in the do­mes­tic mar­kets along with the eco­nomic sit­u­a­tion, its reper­cus­sions on the per­for­mance of com­pa­nies in the fu­ture. Also, KFH inked with the Min­istry of State for Youth Af­fairs two agree­ments; col­lab­o­ra­tion and part­ner­ship agree­ment, and an agree­ment to sup­port the ac­tiv­i­ties of cel­e­brat­ing Kuwait as “Cap­i­tal of Arab Youth”. This so­lid­i­fies the bank’s role in sup­port­ing the youth and re­flects the keen­ness to take part in the strate­gic ini­tia­tives that rep­re­sent Kuwait and shed light on its cul­ture.

Al-Mar­zouq stressed the im­por­tance of mov­ing for­ward in fo­cus­ing on the core bank­ing busi­ness through im­prov­ing the oper­a­tional rev­enues while rolling out ad­vanced bank­ing prod­ucts and ser­vices, in­di­cat­ing that the per­for­mance and re­sults of KFH prod­ucts and ser­vices ex­ceeded pro­jec­tions. The bank re­in­forced its tech­no­log­i­cal chan­nels and im­ple­mented dif­fer­ent cus­tomer-cen­tric ini­tia­tives that re­volved around cus­tomer sat­is­fac­tion as per ac­cu­racy, se­cu­rity and qual­ity stan­dards.

As part of its in­no­va­tion ef­forts and the keen­ness to adopt the lat­est bank­ing tech­nol­ogy, KFH launched sev­eral es­er­vices such as the XTM; the novel ap­proach that al­lows cus­tomers to per­form their trans­ac­tions in a very mod­ern and se­cure man­ner. KFH, in as­so­ci­a­tion with Visa, is the first bank in Kuwait to launch Visa Check­out (VCO), a ser­vice, which en­ables quick, safe and se­cure on­line pay­ment. More­over, the bank launched 4 in­no­va­tive e-ser­vices in the fields of bank ac­counts and call cen­ter. The ser­vices are “Call Back As­sist”, “ANI” Ser­vice, “Fa­vorite Menu” ser­vice and “Link Ac­counts” ser­vice. The bank in­tro­duced a multi-cur­rency ATM ma­chine at the air­port branch with four for­eign cur­ren­cies; USD, Euro, SAR, and AED. AlMar­zouq said that as part of the bank’s pol­icy to ex­pand its branches net­work, KFH in­au­gu­rated its 66th branch in AlNuzha. KFH is keen on de­liv­er­ing su­pe­rior ser­vices to its cus­tomers.

He ex­plained that KFH Group is suc­cess­fully achiev­ing its goals based on the mar­kets in which it op­er­ates. Ev­ery Group bank in Turkey, Malaysia, Saudi Ara­bia, Bahrain and Ger­many is work­ing in a way con­sis­tent with the na­ture of those mar­kets, in line with the strat­egy of KFH. This adds more re­silience to the modus operandi of the Group banks, yet qual­i­fies them to tap op­por­tu­ni­ties and uti­lize any pos­i­tive de­vel­op­ment. KFH has a global in­te­grated op­er­a­tions lead­ing the Is­lamic fi­nance in­dus­try glob­ally, and of­fer­ing a suite of fi­nan­cial Is­lamic ser­vices and prod­ucts. KFH’s group bank­ing net­work spans across seven re­gions world­wide, with over 480 branches, over 990 ATMs and ap­prox­i­mately 15,400 em­ploy­ees.

Fur­ther, he noted that KFH so­lid­i­fied its role in the cor­po­rate so­cial re­spon­si­bil­ity through par­tic­i­pat­ing in a plethora of so­cial, hu­man­i­tar­ian and aware­ness ini­tia­tives. KFH im­ple­mented dif­fer­ent so­cial ini­tia­tives that ac­cen­tu­ate its pi­o­neer­ing role and com­mit­ment to­wards so­ci­ety. He ex­pressed his thanks and ap­pre­ci­a­tion to all share­hold­ers and cus­tomers for their sup­port and con­fi­dence. He ex­tended his thanks to the reg­u­la­tory au­thor­i­ties. He hailed the ef­forts of KFH’s ex­ec­u­tive man­age­ment and em­ploy­ees for their out­stand­ing per­for­mance that yielded pos­i­tive re­sults that re­flect the pres­ti­gious sta­tus of KFH; the world lead­ing Is­lamic fi­nan­cial in­sti­tu­tion.

Ha­mad Ab­dul­mohsen Al-Mar­zouq

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