19 February 2019: Ahli United Bank B.S.C. (AUB) reported a net profit attributable to its equity shareholders of US$ 697.5 million for the year 2018, representing a rise of 12.7% as compared to the net profit of US$ 618.7 million in 2017. The net profit in Q4/2018 was US$ 169.3 million as compared to US$ 150.0 million in Q4/2017.
Operating income increased from US$ 1,119.4 million to US$ 1,210.6 million in 2018 (+ 8.1%). The growth in operating income, mainly driven by an increase in net interest income (NII) by US$ 64.1 million (+7.3%) to US$ 940.5 million (2017: US$ 876.5 million), was attributable to an increase in average interest earning assets and to the repricing and re-positioning of the loan portfolio, complemented by an effective interest rate risk management strategy. Net operating income increased from US$ 1,030.4 million to US$ 1,124.3 million in 2018 (+ 9.1%).
Operating income in Q4/2018 was US$ 303.5 million as compared to US$ 294.2 million in Q4/2017 (+3.1%). Net operating income for Q4/2018 was US$ 279.1 million, higher by 6.7% compared to US$ 261.6 million in Q4/2017.
The continued disciplined implementation of the intelligent spend approach and the benefits of growing operational efficiencies within the AUB Group resulted in a cost income ratio of 27.1% (2017: 28.8%).
Solid asset quality levels were sustained with a gross non-performing loans ratio of 1.9% (31 December 2017: 1.9%) while the specific provision coverage ratio increased to 85.5% (31 December 2017: 85.1%). The total provision coverage ratio, inclusive of credit loss provisioning under IFRS 9 but excluding very substantial non-cash collaterals available, improved to 214.7% as at 31 December 2018 (31 December 2017: 154.3%).
Overall Return on Average Equity (ROAE) increased to 18.1% (2017: 16.5%) while the Return on Average Assets (ROAA) increased to 2.2% (2017: 2.1%).
The Group's total assets grew by US$ 2.3 billion (+6.8%) to reach US$ 35.5 billion at 31 December 2018 driven by a growth in the non-trading investments portfolio to US$ 7.6 billion (31 December 2017: US$ 6.0 billion) as part of an overall strategy to further balance-sheet diversification and to enhance in-built liquidity sources. Asset growth was funded from an increase in customer deposits (+US$ 1.7 billion) and through repo borrowings (+US$ 0.6 billion). Equity attributable to the owners of the bank increased by 2.4% to US$ 3.9 billion in 2018 (2017: US$ 3.8 billion).
The resultant basic earnings per share increased by 12.2% to US cents 8.3 for the year ended 31 December 2018 (2017: US cents 7.4). The Board of Directors has recommended a distribution comprising of a cash dividend of US cents 5.0 per share (2017: US cents 4.5 per share) together with a bonus ordinary share issue of 10% (2017: 5%).
Mr. Meshal Al-Othman AUB Chairman, commented: “AUB continued its solid performance in 2018 against the backdrop of a continuing general difficult operating environment. Achieving a very robust growth of 12.7% in net profit over 2017 demonstrates its strong underlying fundamentals and the resilience of its diversified business and geographic model.”