Net profit in Q3 2018 up by 19 percent to KD 16 million
KUWAIT CITY, Oct 22: Gulf Bank K.S.C.P. (“The Bank”) announced its financial results for the first nine months of 2018. The Bank recorded a net profit of KD 42.7 million in the first nine months of 2018, an increase of 18% over the same period in 2017. In Q3 2018, Gulf Bank reported a net profit of KD 16 million, an increase of 19% compared to the same period in 2017.
The Bank generated net interest income of KD 115.4 million during the first nine months of 2018, 19% above the same period of the prior year. The operating margin (Operating profit before provisions/ impairment losses) was KD 97.4 million during the first nine months of 2018, recording a growth of 9%, over the same period in 2017.
Over the same respective periods, the Bank witnessed an enhancement in margins and returns as net interest margin expanded from 2.33% to 2.66%, return on assets increased from .87% to .98%, and return on equity grew from 8.4% to 9.5%.
In addition, asset quality continues to improve as the non-performing loan ratio fell to 1.5% with an NPL coverage ratio of 478% at the end of September 2018. Compared with 30 September 2017 balances, total assets increased by 5% to KD 5.9 billion while loans and advances to customers increased by 7% to KD 3.8 billion. Total equity was up 4% to KD 614 million and customer deposits grew by 5% to KD 3.7 billion. As of the end of September 2018, total general provisions on the balance sheet stood at KD 219 million, over and above shareholders’ equity of KD 614 million.
Commenting on the results, Omar Kutayba Alghanim, Gulf Bank’s Chairman said: “We are pleased with our Bank’s solid performance for the first nine months of 2018. These strong results highlight the Bank’s progress quarter after quarter and confirm that we are on the right track in delivering sustainable results to our stakeholders. Gulf Bank’s adequate capitalization is reflected in its Capital Adequacy ratio of 16.8% at the end of September 2018, which is well above our minimum regulatory requirement of 14%. The quality of our assets also continues to improve, as the Bank’s non-performing loan ratio fell to 1.5% at the end of September 2018.”
Recent Developments In line with Gulf Bank’s new strategy of Customer Service and Innovation, the Bank announced the launch of its new website. This new website was designed following global best practices and introduces many new features to enhance the overall customer experience.
In addition, Gulf Bank launched the Gulf Bank Cashback card, which provides cardholders up to 10% cashback on all local and international spends. The program has been built around the spending patterns of our customers and it adds to the new line up of cards that were introduced to all customer segments in the second quarter of 2018.
“A” Credit Ratings
Gulf Bank continues to be well recognized in terms of its credit worthiness and financial strength internationally as it is rated “A” by all four leading credit rating agencies. Recently, Fitch Ratings affirmed Gulf Bank’s long-term issuer default rating at “A+” with a “Stable” outlook, Moody’s Investor Services revised their outlook on the Bank to “Positive” from “Stable” and affirmed its issuer credit rating at “A3“in May 2018.
Similarly, S&P Global Ratings affirmed Gulf Bank’s credit rating at “A-“with a “Stable” Outlook in June 2018. Capital Intelligence, on the other hand, recently upgraded the Bank’s rating to “A-” from “BBB+” with a “Stable” outlook. Alghanim commented on the Bank’s credit rating by saying: “The “A” credit ratings by the four leading rating agencies is considered an international validation of Gulf Bank’s sustained improvement in its asset quality and financial strength”.
Alghanim concluded his remarks by stating: “I would like to thank everyone that contributed to these strong results. I’d also like to thank our shareholders and the Central Bank of Kuwait for their continued support. I especially want to thank our customers for their loyalty and reiterate our commitment to place them at the center of everything we do.” Gulf Bank is one of the leading conventional banks in Kuwait with total assets of KD 5,949 million as on 30 September 2018.
The Bank provides a broad offering of consumer banking, wholesale banking, treasury, and financial services through its large network of 58 branches and more than 200 ATMs in Kuwait. The Bank was founded in 1960 and is listed on the Kuwait Stock Exchange (Boursa Kuwait) since 1984.