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KUWAIT CITY, Jan 25: Sheikh Mohammed Jarrah Al-Sabah, Chairman of Kuwait International Bank (KIB) announced that during 2016, the Bank’s profits have increased by 14% to reach KD 18.2 million compared to KD 16.1 million in 2015.
This growth is attributable to an increase in revenues accompanied by an effective cost optimization. The financing income increased by 12% reaching KD 71 million compared to KD 63.2 million during 2015. Revenue from fees and commission increased by 5, to reach almost KD 9 million, as compared to KD 8.3 million in the previous year.
Al-Jarrah stated that the Bank’s improved performance reflected positively on earnings per share (EPS) for 2016, which increased by 14% reaching 19.50 fils compared to 17.14 fils for the previous year.
As for dividends, Al-Jarrah stated, KIB’s Board of Directors has recommended to its shareholders’ Annual General Assembly, cash dividends of 10% of the share nominal value (10 fils per share) for shareholders registered at the Bank’s records on the AGM date and is subject to the approval of the Bank’s AGM and regulatory authorities.
KIB’s total assets increased by 3% reaching KD 1.85 billion compared to KD 1.79 billion by the ending 2015. This increase is attributable to a growth in the financing portfolio by KD 95 million reaching KD 1.27 billion compared to KD 1.17 billion last year achieving 8% growth compared to the previous year. Investment portfolio increased by KD 19 million, i.e. by 17% reaching KD 128 million compared to KD 109 million at 31 December 2015. Depositors’ accounts rose to KD 1.12 billion compared to KD 1.02 billion by the end of the previous year, an increase of KD 107 million representing a growth of 10%.
KIB’s outstanding performance and collection efficiency throughout 2016 has positively reflected on its asset quality and coverage ratios. NPL ratio has been maintained at 1.4% o. Total provision coverage ratio has also increased to 231% compared to 199% for 2015. Moreover, total provisions and collaterals coverage ratio increased to 368% compared to 327% for the previous year. In this context, Al-Jarrah praised KIB’s performance and achievements pertinent to these significant indicators.
In full conformity with CBK regulations on Basel III, KIB continued to maintain an excellent capital adequacy ratio (CAR) of 20.5% while the financial leverage ratio was over 10.7% for the year 2016.
Return on Equity (ROE) reached 7.2% in comparison with 6.5% for the previous year due to the enhancement of various performance indicators mentioned above. This resulted in an increase in the distributions to depositors’ accounts since the beginning of 2016 whereby the annualized return on Arzaq deposit in Kuwaiti Dinars increased to 2.15%, 2.25% and 2.35% in Q1, Q2 and Q3 respectively. Rates in Q4 2016 reached 2.55% resulting in an average of 2.325% for the year 2016. Al Boushra Kuwaiti Dinar three year deposits were offered 3.0625%. Profits were credited into the depositors’ accounts upon declaring the financial results.
Sheikh Mohammed Jarrah Al-Sabah stated that KIB’s impressive performance and robust growth comes as a result of the Bank’s implementation of its long term strategic plan. This strategy aims to bring about a comprehensive transformation across all sectors of the Bank in terms of better asset quality, healthy capital buffer, improved performance, increase in profitability, new and innovative products and enhanced service offerings to customers.
Al-Jarrah also mentioned that Al Dawli continues its efforts to bring a complete evolution of its banking services and offerings. In an effort to provide customers with an enhanced digital banking experience, KIB has made major investments in upgrading its IT infrastructure and streamlining its systems and processes. “Much of our continued success can be credited to our successful implementation of the forward-thinking strategy, which have been extremely successful in enhancing our position within the Islamic banking sector, setting us well on our way to achieve our vision of becoming the ‘Islamic Bank of Choice in Kuwait’,” added Al-Jarrah.
KIB’s achievements during the year were recognised by various international agencies. These included “Best Islamic Bank – GCC” from World Finance, “Best Sharia Compliant Bank – MENA” from CFI.co and “Best Banking Vision” from CPI Financial. KIB was also honored for excellence in labor nationalization ratio in the private sector across the GCC. Fitch ratings upgraded KIB’s viability rating and re-affirmed Long-term Issuer Default Rating (IDR) at ‘A+’ with a stable outlook in 2016.
Al-Jarrah concluded by expressing his gratitude towards the Central Bank of Kuwait for their guidance, as well as the Board of Directors, executive management, employees and customers for their support in achieving this remarkable performance.