Ahli United Bank (AUB) reported a net profit attributable to its equity shareholders of $579.4 million for the year 2013, growth of 72.6 per cent compared with $335.7 million in 2012.
This included a non-recurring gain of $212.9 million on the sale of its 29.4 per cent stake in Ahli Bank Qatar (ABQ). Excluding this item, the operating net profit of the Bank was $366.5 million representing a 25.7 per cent increase over the previous year. The last quarter of 2013 contributed $77.2 million as compared to $71.5 million in Q4/2012.
Operating income increased from $848.7 million to $958.3 million in 2013 (+ 12.9 per cent), driven largely by a rise in net interest income (NII) of 12.1 per cent to $713.2 million (2012: $636.4 million) and a 16.2 per cent growth in fee income from $121.4 million to $141.1 million. The NII increase was achieved through focused liability cost management together with prudent growth in asset volumes within acceptable risk criteria. Increased operating income and disciplined cost culture aligned to business needs across the AUB Group further improved the operating cost income ratio to 30.0 per cent (2012: 31.5 per cent).
The Group's total assets grew by $2.8 billion (+9.3 per cent) to reach $32.7 billion by 2013 year-end. This is attributable to an 8.3 per cent growth in the loans and advances portfolio to $17.3 billion (31 December 2012: $16.0 billion). Credit growth was funded by a 17.4 per cent growth in customer deposits to reach $22.0 billion (31 December 2012: $18.8 billion). The non-performing loan ratio was 2.6 per cent as at 31 December 2013 (31 December 2012: 2.4 per cent) with a specific provision coverage ratio of 87.6 per cent (31 December 2012: 87.7 per cent). The total provision coverage ratio, inclusive of collective impairment provisions, was 149.4 per cent as at 31 December 2013 (31 December 2012: 149.8 per cent). Shareholders' equity increased by $0.4 billion (+13.4 per cent) to $3.1 billion.
Return on Average Equity was 20.1 per cent (2012: 13.0 per cent) with Return on Average Assets of 2.0 per cent (2012: 1.3 per cent). Adjusting for the exceptional non-recurring gain of $212.9 million, Return on Average Equity increased to 13.4 per cent while Return on Average Assets was sustained at 1.3 per cent.
The resultant basic earnings per share was US cents 10.5 for the year ended 31 December 2013 (2012: US cents 6.1). Given the excellent results achieved, the Board of Directors has recommended a cash dividend of US cents 4.5 per share (2012: US cents 4.0) together with a bonus ordinary share issue of 5 per cent (2012: 5 per cent).
During the year, the International Finance Corporation Capitalization (Equity) Fund (IFC Fund) accelerated conversion of its holding in AUB's $125 million Mandatorily Convertible Preference Shares (MCPS) into 167,045,454 new AUB common shares. IFC Fund's decision to exercise the conversion option prior to the mandatory conversion date represented a strong vote of confidence in the solid regional fundamentals of AUB and in its future business and growth prospects.
Standard & Poor's Rating Services also raised its long-term counterparty credit rating on AUB from "BBB" to "BBB+" with a Stable Outlook.
"AUB has managed to deliver a very strong set of results through its focused development of business opportunities and its prudent and pro-active management of risks. Of particular satisfaction was the 25.7 per cent surge in net profits, excluding the non-recurring impact of the Qatari affiliate stake sale. These results underpin the solidity of our business model, and AUB continues to remain confident of its ability to maintain its performance given its strong underlying fundamentals", commented Fahad Al-Rajaan, Chairman, AUB.