Last checked at 26 Oct 2010 09:11
BankMuscat achieves RO 72.2 million net profit, board approves 9-month results
MUSCAT, 25 October 2010 - BankMuscat, the leading financial services provider in the Sultanate, yesterday (Monday 25 October 2010) announced the financial results, approved by the board of directors, for the nine-month period ending 30 September 2010.
The Bank achieved a net profit of RO 72.2 million for the nine months ended 30 September 2010 compared to RO 80.4 million reported during the same period in 2009. The net profit for the nine months ended 30 September 2009 included RO 53.2 million of post-tax gain on sale of HDFC Bank investment, RO 8.5 million losses on available-for-sale investment portfolio and around RO 30 million of credit losses towards Saudi branch exposures. Excluding these one-off items, the adjusted net profit for the nine-month period in 2009 was RO 65.7 million. Thus, on a like to like comparison, the net profit for the nine months ended 30 September 2010 showed an increase of 10 per cent over the same period in 2009.
AbdulMalik bin Abdullah Al Khalili, Chairman of BankMuscat, said: "The key business lines of the Bank recorded encouraging performance during the period in question.The banking and financial sector is witnessing healthy performance in tandem with the economic recovery led by sustained consumer demand and public sector activities."
Net interest income increased by 8 per cent to RO 137.1 million during the nine months ended 30 Sep 2010 from RO 126.8 million reported during the corresponding period in 2009. Non-interest income was higher by 10 per cent compared to the nine months period ended 30 Sep 2009, excluding the gain on HDFC Bank investment and realised losses on Available-for-Sale investment. Operating expenses for nine months ended 30 Sep 2010 was at RO 75.5 million, an increase of 17.5 per cent as compared to the same period in 2009. The increase in operating expense is attributable to the long-term vision and strategy to develop the banking infrastructure by way of technology investments, expansion of delivery channel network and business to provide better service and maintain the leadership position.
Impairment for credit losses for the nine-month period in 2010 was RO 30 million as against RO 68.7 million in 2009. In addition, the Bank has made a collective provision of RO 1.9 million on placements with banks. Recoveries from impairment for credit losses was RO 9.7 million as against RO 8.3 million for the nine-month period ended Sep 30, 2009. During the quarter, the Bank was able to write back RO 3.4 million of impairment loss provision on bank placements after concluding sale of an impaired asset.
Share of loss from associates was RO 8.8 million for the nine months ended 30 Sep 2010 as against RO 5.3 million in 2009. The higher share of loss was due to BMI Bank net loss for the quarter due to higher credit losses as some of the exposures did not perform as expected in Q310.
Gross loans and advances increased by 5 per cent to RO 4,109 million as against RO 3,921 million as at 30 Sep 2009. Customer deposits, including CDs, increased by 4 per cent to RO 3,442 million as against RO 3,298 million as at 30 Sep 2009. Savings deposits witnessed an impressive growth of 13 per cent from RO 716 million as at 30 Sep 2009 to RO 811 million as at 30 Sep 2010. Whereas the current and call account grew by 20 per cent from RO 977 million as at 30 Sep 2009 to RO 1,168 million as at 30 Sep 2010.
The strategic initiatives by the Bank during Q310 included the successful handling of the initial public offering (IPO) of leading telecommunications company Nawras as sole issue manager. The Nawras IPO marked a share offer in Oman nearly after two years.