Manama / Emirates Business
The Bahrain-based leading Islamic banking group, Al Baraka Banking Group B.S.C (ABG), announced that its total operating income reached one billion dollars in 2015 for the first time since the start of the Group activities 12 years ago due to continued growth in income-generated business at all the Group units, while the net income for the year reached US$ 286 million in 2015, an increase of 4% on the net income achieved in 2014. Similarly, balance sheet items witnessed moderate increases as total assets increased by 5%, total finance and investments by 4%, customer accounts by 2% while total equity increased by 1% as at the end of December 2015 in comparison with the end of December 2014. These excellent results were achieved despite the adverse effects of the appreciation of US currency against the currencies of countries where a number of our units operate and the economic and financial fluctuations regionally and internationally.
Commenting on these results, HE Sheikh Saleh Abdullah Kamel, Chairman of Al Baraka Banking Group , said “ The year 2015 witnessed an increase in the difficult economic and political conditions regionally and globally, especially during the second half of the year with the China reduced the value of its currency, which sparked off fears of the prospects for the global recovery, and extended oil losses, while the security tensions continued in the region and generated an extremely cautious environment for banks. Therefore we are very proud to see continuing growth in the revenue and business of Al Baraka Banking Group , and further elevation in its regional and global standing. This embodied once again the success of the business model that we followed since the founding of the Group, a model that reflects the true values of socially-responsible Islamic banking, supported by distinct human expertise and large and diversified technical and financial resources, which all have contributed to the translation of that model to the ambitious objectives and strategies and growing financial results and profitability. All these efforts were culminated with the transfer of the Group to the main headquarters in Bahrain Bay at the end of the last year, which is an architectural masterpiece that is equipped with all modern techniques and facilities, and would allow the Group to launch a new stage in its activities and businesses”.
For his part, Mr. Abdulla Ammar Al Saudi, Vice Chairman of ABG , said that “In 2015, the weak economic growth experienced in the majority of developed and developing countries was by and large replicated in the countries in which ABG operates. In the challenging conditions prevailing, not least of which was the depreciation of the domestic currencies of several of ABG ’s subsidiaries respective to the US dollar – the Group’s currency of report – ABG did well to maintain its record of growth and steadily increasing profitability, thanks to wise policies and strategies developed by the Group and are being implemented by all units”.
Mr. Adnan Ahmed Yousif, Member of the Board of Directors and President & Chief Executive of Al Baraka Banking Group , said “The outstanding results achieved during 2015, embodies our determination to implement all the initiatives that we planned for launch early this year, defying all economic and political datum regionally and globally, and which generated difficult operating and technical conditions for banks in the region. The most important of these initiatives has been to continue improving the quality of products and services, introducing more innovative products, expanding the branch network of ABG subsidiary units, strengthening relationships with our partners, investors and customers, and entering new markets as well as modernizing and developing our human, operational, regulatory and technical infrastructures both at Group level and subsidiary banking units levels. All these initiatives have contributed to maximizing the returns to the shareholders and investors of the Group, thanks to our deep experience in the markets were we operate in addition to large financial and technical resources and the wide branch network of our units”.
“We are very pleased to see the contribution of all our banking units in the growth of profits of the Group, which reflects the sound financial positions enjoyed by these units. Coincided with this, the cooperation between the Group’s units in trade financing activities for MENA countries have increased, which contributed to the emergence of the role of the Group as a key player in promoting trade and investment between these countries”.
“The end of last year saw a luminous turning point in the march of Al Baraka Banking Group , where we moved to the new headquarters of the Group in Bahrain Bay . The cost of the project is around US$ 100 million. We are very pleased for the completion of this distinctive and unique of its kind architectural edifice. Such efforts were not possible without the availability of atmosphere of stability and security in the Kingdom of Bahrain, in addition to the many facilities offered by the concerned official bodies, and full confidence in the performance of the national economy in the short and long term, all of which are factors that strengthen the confidence of major financial institutions in the Kingdom, and stimulated them to move forward in the implementation of their vital projects, which no doubt will have many positive repercussions on economic development in Bahrain. The new Headquarter of the Group is designed to meet its present and future needs. The choice of the Bahrain Bay for the construction of its headquarters stems from the belief of the vital importance enjoyed by the Kingdom of Bahrain as a financial and Islamic banking center both regionally and globally.”
This project embodies a dream for us to see the new headquarters of the Group constructed on latest architectural style and equipped with latest modern equipment and facilities, and therefore, the site will support the requirements for success of Al Baraka Banking Group , regionally and globally and, it is consistent with our future goals and aspirations”.
With regard to the Group’s plans to expand its branch network, the President & Chief Executive said that “Most of our units continued in 2015 to open new branches, where total new branches opened in 2015 reached 38 branches to bring total branches to 587 branches with total staff of 11,458 at the end of December 2015. This reflects our determination to consolidate and expand our activities in the countries where we operate currently. We would also like to refer here, in particular, to the role of the expansion of the branches in the creation of rewarding jobs to citizens in the communities in which we operate, which is reflected in the total number of Group employees. There is no doubt that the success in achieving this translates one of the main pillars of the banking business model, which is committed by the Group”.
“In terms of geographical expansion, we finished, by God Praise, from the legal requirements of our application to establish a banking unit in Morocco, which will serve as a major achievement on the level of entry to this important and large market with rich opportunities, and thus will complete our presence network in all the Arab Maghreb countries approximately”.
“During September 2015, our unit in Turkey, Al Baraka Turk Participation Bank, had concluded a syndicated Sharia compliant Murabaha financing, raising a total of US$450 million divided in US$ 278 million and EUR 154.5 million. A number of 17 famous international banks from 11 countries participated in the facility covering all main world financial centers. We are indeed delighted at the large success of the syndicated Murabaha financing deal, despite the volatile financial markets and international economic situation, which endorses the reputation of Al Baraka Turk Participation Bank and its distinguished position in the Turkish market, based on the strength of its financial position and growing performance over the past many ears, as well as the distinguished reputation and position of the parent company, Al Baraka Banking Group , regionally and internationally”.
“During the same month also, Dagong Global Credit Rating Company Limited (Dagong) and Islamic International Rating Agency (IIRA) jointly reaffirmed the international investment grade credit rating ofAl Baraka Banking Group at ‘BBB+/A3’ (Triple B Plus / A Three). In addition, IIRA has reaffirmed ABG ’s national scale rating at ‘A+(bh)/A2(bh)’ (Single A Plus / A Two). Outlook on the assigned ratings is ‘Stable’. IIRA has also reassessed the group’s overall fiduciary score in the range of ‘76-80’, which indicates strong fiduciary standards and a well-developed governance structure, wherein rights of various stakeholders are well defined and protected. Standard & Poor’s continued to rate the Group at BB+ (long term) / B (short term) with stable outlook”.
“Corresponding with the launch of its Social Responsibility Report at the end of last year, Al Baraka Banking Group also announced its 2016-2020 Social Responsibility Priorities, where the Group was keen to link them with the Global Goals for Sustainable Development, which was adopted by the United Nations’ General Assembly on September 25, 2015. The Group’s development goals of the social responsibility program for the next five years will concentrate on adding 50,000 jobs across the countries we operate in as a result of financing new and existing customers operations. They will concentrate also on financing and donating to a variety of educational institutions and children hospitals, cancer hospitals, diabetic hospitals, kidney dialysis units. We will work with customers that are more closely aligned with the above Al Baraka Social Responsibility Priorities and the Global Goals for Sustainable Development”.