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SICO reports BD 1.7 million net profit in the first mine months of 2020

November 12, 2020

SICO BSC (c), licensed as a conventional wholesale bank by the Central Bank of Bahrain “CBB”, announced its consolidated results for the third quarter and nine-month period ended 30 September 2020.

On a quarterly basis, SICO’s consolidated net profit for the third quarter of 2020 was BD 1.6 million, marking a 119% increase compared to BD 708 thousand from the same quarter in 2019. Earnings per share (EPS) for the quarter were 4.20 Bahraini fils, compared to 1.91 Bahraini fils in the third quarter of 2019. Total comprehensive income for the third quarter of 2020 increased by 78% to BD 1.9 million from BD 1.1 million recorded in the same quarter of 2019.

SICO recorded a consolidated net profit for the first nine months of 2020 amounting to BD 1.7 million, a decrease of 52% from BD 3.6 million recorded in the corresponding period of 2019. EPS were 4.63 Bahraini fils for the first nine months of 2020, compared to 9.67 Bahraini fils in the same period of 2019. SICO’s total comprehensive income amounted to BD 1.2 million in the first nine months of 2020. A decrease of 70% compared to BD 4.1 million recorded in the same period of 2019.

Total shareholders’ equity as at 30 September 2020 amounted to BD 56.6 million representing a decrease of 5% from BD 59.4 million as recorded at year-end 2019. The decline reflects the dividend distribution during the period amounting to BD 3.9 million.

SICO’s total assets recorded BD 187.9 million as at 30 September 2020, increasing by 13% from BD 166.8 million at year-end 2019. The increase is owing to higher cash and bank balances and securities bought under repurchase agreement.

SICO’s net investment income amounted to BD 1.7 million for the first nine months of 2020 compared to BD 3.1 million recorded in the first nine months of 2019, with the decline driven by adverse market conditions in the first half of the year. However, net investment income posted a strong recovery in Q3 2020, recording BD 2.0 million compared to a loss of BD 415 thousand in the corresponding quarter of 2019.

Meanwhile, SICO’s aggregate net fee, brokerage and other income reached BD 5.3 million in the nine-month 2020 period, up 7% compared to BD 4.9 million recorded in the same period last year.

Total assets under management (AUMs) amounted to BD 792.5 million (USD 2.1 billion) compared to BD 808.7 million (USD 2.1 billion) recorded at year-end 2019. AUMs increased in the third quarter of 2020 by BD 133.2 million (USD 353.3 million) thanks to asset management team’s active and successful fund raising, as well as improved market performance.

Assets under custody with the Bank’s wholly owned subsidiary, SICO Funds Services Company (SFS), stood at BD 2.8 billion (USD 7.4 billion) at 30 September 2020, remaining stable compared to the BD 2.8 billion at the end of 2019.

Commenting on SICO’s performance for nine-month period, Chairman of the Board Shaikh Abdulla bin Khalifa Al Khalifa said: “SICO delivered a commendable performance during the nine-month period despite the challenging market conditions. In particular, our third quarter’s strong results were testament to our clients’ trust in our proven capabilities and further cemented SICO’s position as a leading regional investment house. Our diversified revenue stream together with our strong and liquid balance sheet enabled us to progress further with our strategic plans, even amid such turbulent times.

“Going forward, we remain cognizant of the challenges posed by a second wave of Covid-19 and its impact on market volatility, particularly oil prices. Nonetheless, the Board is confident in SICO’s ability to navigate the current challenges and continue delivering on its near- and long-term strategic plans to achieve further growth.”

Chief Executive Officer Ms. Najla Al-Shirawi further added: “Both global equity markets and regional debt markets witnessed a strong rally in the third quarter. This helped drive high returns from SICO’s investment book, with income generated from SICO’s proprietary investments in the third quarter of 2020 delivering an almost three-fold increase compared to 2019. Meanwhile, our asset management division witnessed significant growth bolstered by new AUM mandates and SICO’s signature funds’ continuous outperformance. At the bank’s brokerage business, SICO continued to broaden its client base, leveraging on its digital trading platform SICO LIVE which offers access to regional and global markets. The division’s strong results in the nine-month period were thanks to growing trading values with the introduction of international equities and bonds, and SICO was also successful in extracting higher value from its brokerage activities with a ramp up of its margin lending and repo business. SICO continues to be the Kingdom’s leading broker with a 60% market share in Q3 2020 and the most active market maker for 22 consecutive years.”

“On the regional front, SICO is currently in the final stages of its acquisition of a majority stake in Muscat Capital, the Saudi-based wholly owned subsidiary of Bank Muscat, subject to the approval of the regulators in Bahrain and KSA. This acquisition is in line with SICO’s strategy to further enhance its on-the-ground presence in Saudi Arabia, capitalizing on the Kingdom’s increased growth and further expanding its activities and service offerings,” added Al-Shirawi.