Arab Bank’s net profit rises by 15%

AMMAN — Arab Bank Group generated $577.2 million net profit after tax and provisions in 2014, according to a bank press statement received Saturday.  

The net profit, the press release indicated, was 15 per cent higher than amount recorded in the previous year. 

"To enhance the bank’s capital adequacy ratio and to further expand its business, the board of directors recommended distributing dividends at a rate of 24.5 per cent for the year 2014: cash dividends of 12% and two free shares for every sixteen shares," the press release stated.

"Despite the challenging environment and the devaluation of several major currencies, the bank managed to grow loans and advances by 3 per cent to $23.7 billion, compared to December 2013," it added. 

According to the bank, customer deposits grew by 2 per cent to  $35 billion. Adjusting for the impact of exchange rates and extraordinary items, loans and customer deposits increased by 9 per cent and 7 per cent respectively.

Sabih Masri, Arab Bank’s chairman described the results as a confirmation of the bank's ability to deliver strong results, maintain a solid balance sheet and a quality portfolio.

"Loan quality remains very strong with no increase in non-performing loans and a provisions coverage ratio in excess of 100%, excluding the value of collaterals held," he indicated

Nemeh Sabbagh, Arab Bank’s chief executive officer, stated that Arab Bank succeeded in growing its operating income benefiting from its diversified business model, and controlling operating expenses.

"Key financial indicators remain strong as the bank’s liquidity continues to be robust with a loan-to-deposit ratio of 67.7 per cent," he pointed out. "Capital adequacy ratio reached 14.8 per cent as at end of December 2014."

Sabbagh reiterated confidence in the bank's soundness and strength of its legal position in the appeal stage of the lawsuit filed against the bank in New York. 

Masri expressed full confidence in the bank’s ability to maintain sustainable growth in profits and a strong level of capital adequacy.

The bank’s results are subject to the final approval of the Central Bank of Jordan.