Arab Banking Corporation announces half-year profit of $112m

Arab Banking Corporation (ABC) today announced that its consolidated Group net profit for the first half of 2013 was $112 million, a 7 per cent increase when compared to $105 million for the same period last year. Net profit for the second quarter was $56 million, 10 per cent higher than $51 million reported during the same period in the previous year. Total operating income for the second quarter amounted to $210 million, 9 per cent higher than the $193 million achieved during the same period last year. Despite adverse exchange rate changes in emerging markets and the persistent compression in credit spreads, total operating income grew on the back of increased fee income from lending, trade finance and treasury activities. The total operating expenses for the second quarter were $115 million, an increase of 12 per cent over $103 million in the same period last year in part owing to one-off restructuring costs. Net impairment provisions for the second quarter of 2013 were $10 million, marginally down from $13 million in the same period of the previous year, according to a media statement. Deposits continued to grow during the year from $17.2 billion at 2012 year-end to $ 17.9 billion, resulting in a further improved liquidity position. Shareholders’ equity at 30 June 2013 stood at $3,819 million, compared to $3,846 million at the end of the first quarter 2013 and $3,778 million at 2012 year-end. The slight decrease during the second quarter was mainly due to exchange translation on foreign subsidiaries following the rise in dollar. ABC’s capital base remains very strong, with a capital adequacy ratio of 22.7 per cent, predominantly Tier 1, which totalled 18.7 per cent. ABC Group’s total assets stood at $25.3 billion at the end of the second quarter, 3 per cent higher when compared to $24.5 billion at 2012 year-end. ABC's Chairman, Mr. Saddek El Kaber, commented: "Despite adverse conditions in the MENA region, the ABC Group has continued to achieve its targets on a consistent basis. I am pleased with the serious efforts to enhance efficiencies within the Group on all fronts, laying a solid foundation for accelerated growth and transformation."