The financial statements of the Group for the first quarter of 2011 showed that the continued expansion in business reflected positively on income, with total operating income of US$ 170 million in the first quarter of 2011, an increase of 8% over same period in 2010. After deducting all operating expenses, net operating income amounted US$ 84 million in first quarter of 2011, which represents an increase of 8% compared to the net operating income during the first quarter of 2010. The net income amounted to US$ 53.5 in first quarter of 2011 compared to US$ 48 million in first quarter of 2010, which reflects an increase of 11%. The net income attributable to equity holders of the parent amounted to US$ 31 million compared to US$ 28 million for the first quarter of 2010, which represent an increase of 11%. This increase was achieved despite the increases in the operating expenses of the Group on account of further expansion in the branch network, the effect of merger in Pakistan that happened in October 2010 and enhancements in IT infrastructure and human resources.
The total assets of the Group amounted to US$ 16.3 billion as at the end of March 2011, an increase of 3% over the comparative figure as at the end of 2010. Financing and investments amounted to US$ 11.6 billion as at the end of March 2011 compared to US$ 11.4 billion at the end of December 2010, an increase of 1%. Customer deposit and other accounts and equity of investment account holders have witnessed an increase of 2% from US$ 13.6 billion at the end of December 2010 to US$ 13.9 billion at the end of March 2011, which indicates continued customer confidence and loyalty to the Group. Total equity at the end of March 2011 remained almost the same as at the end of December 2010, amounting to US$ 1.8 billion.
Commenting on these results, Sheikh Saleh Abdullah Kamel, Chairman of Al Baraka Banking Group, said “A number of Arab countries during the first quarter of 2011 have witnessed large political and social shifts that have had temporary implications on the environment of the banking sector in those countries. It is natural that the operations of banks were affected by these developments, but we nevertheless note with satisfaction that ABG continued to achieve good results, which reflects the Group success in following precautionary strategies that enabled it to deal wisely with these developments and to continue expanding its business, and at the same time continue its geographic expansion programs and building branch network. This was not possible without the strong financial means, human resources and technical capabilities possessed by the Group, as well as its commitment to the Islamic banking model that impose the hard work for the reconstruction of the societies and serve the communities in which it operates”.
For his part, Mr. Abdulla Ammar Al Saudi, Deputy Chairman of ABG, said that ” The financial and operational results achieved in first quarter of 2011 reflects the keenness of the Group to grow steadily and efficiently, despite growing regional and global challenges around us, and growing regulatory, technical and human requirements. We were able to keep pace with all these challenges and requirements, committed to the highest professional and ethical values and principles, on the basis of the new identity of the Group that launched the year before. The Group, through these values and principles, was successful in the implementation of strategies and programs that were applied under the supervision of the Board of Directors of the Group”.
Mr. Adnan Ahmed Yousif, Member of the Board of Directors and President & Chief Executive of Al Baraka Banking Group said “the good results that we achieved during the first quarter of 2011 highlight once more our determination to continue to invest our substantial financial resources and expertise and the wide geographic network of the subsidiary units of the Group in maximising the returns to our shareholders and the investors in the Group by implementing business strategies based on improving the quality of our products and services, offering more innovative products, expanding the branch network of the Group subsidiary units, which is around 376 branches in thirteen countries, strengthening the relationship with our partners, investors and customers and entering new markets, as well as modernizing and developing the human, operational, regulatory and technical infrastructures at the Group and subsidiary banking units levels”.
With regard to the Group’s plans to expand its branch network, the President & Chief Executive said that “the subsidiary units of the Group in Turkey, Jordan and Algeria had resumed expansion by opening new branches in the first quarter of the year and this had direct positive impact on growing their deposit base and financing portfolios. We expect the number of branches of ABG banking units to exceed 500 over the next three years”.
With regard to the Group’s expansion in new markets, Mr. Adnan said that the first quarter of 2011 saw the expansion of the operations of our commercial bank in Syria, Al Baraka Bank Syria. The Bank began to establish strategic partnerships with all personal and corporate customers as evidenced by the growth seen in the balance sheet. In this regard, the total assets amounted to US$ 131 million as at the end of March 2011, a growth of 20% compared to the total assets at the beginning of the year. In additions to furnishing and equipping its head office, the Bank had so far opened three branches, two in Damascus and one in Homs. Furthermore, another two branches one in Hama and one in Aleppo are expected to be opened during this month. The Bank will continue to implement its plan to expand its branch network to cover all Syrian governorates, initially to reach 10 branches by the end of 2011″.
Mr. Adnan added “During the first quarter of 2011, the Group awarded the contract for the construction of the Group Headquarter located in Bahrain Bay, to Arabtec Construction Company which is one of the largest contracting companies in the Arab world. The new Headquarter of the Group is designed to meet the present and future needs of the Group. The choice of the Bahrain Bay for the construction of its headquarters stems from the belief of the vital importance enjoyed by the Kingdom of Bahrain as a financial and Islamic banking center both regionally and globally. This important contract embodies a dream for us to see the new headquarters of the Group constructed on latest architectural style in one of the largest development project in the heart of the Bahraini capital Manama, and therefore, the site will support the requirements for success of Al Baraka Banking Group, regionally and globally and, it is consistent with our future goals and aspirations. The work progress on the site is moving as per the planned schedule”.
As an evidence of its efforts to offer services to customers in accordance with latest technology, the Group was awarded the “Best Corporate Website” among largest Bahraini listed companies for the year 2010. Results have been announced during the GCC 2010 Web ranking annual Survey and Awards. The announcement was made during the “Success in Digital Investor Relations” seminar held in Abu Dhabi under the support of the Middle East Investor Relations Society. The Web ranking scoring was based on technical survey handled by an independent international firm Hallvarsson & Hallvarsson (H&H), the specialist firm based in Sweden.
The President & Chief Executive of the Group added that “In accordance with our new strategy, we have many plans and initiatives that we intend to implement during 2011. These will include launching new innovative products and services in the markets as well as enhancing the standing of ABG in the international markets. All of these plans will be implemented, God willing, successfully considering that we are the only Islamic banking group that has such diversity of geographical presence and excellent knowledge of the markets”.
The President & Chief Executive of ABG concluded his statement by praising the tireless efforts of the executive management at Group Head Office, the executive management teams of the banking units of Al Baraka Banking Group and related parties that played an instrumental role in achieving these excellent results for the Group.
On this occasion, Sheikh Saleh Abdulla Kamel, Chairman of Al Baraka Banking Group, Mr. Abdulla Ammar Al Saudi, Deputy Chairman, Mr. Abdulla Saleh Kamel, Deputy Chairman, and Mr. Adnan Ahmed Yousif, ABG President & Chief Executive and all Members of the Board of Directors of ABG expressed their sincere thanks to the Ministry of Industry and Commerce, Central Bank of Bahrain, Bahrain Bourse and Nasdaq Dubai for the cooperation and assistance they extended to the Group since it was established. They also extended their thanks to all the Central Banks in the countries in which Group banks operate and to all investors and customers for their continued support. They also thanked all the employees of the Group for their loyalty, hard work and dedication which stand behind the successes and achievements of the Group."