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Bahrain's Ithmaar Bank swings to $4.2m Q1 net profit

May 12, 2021

Ithmaar Bank, a Bahrain-based Islamic retail bank, has reported a net profit of BD1.6 million ($4.2 million) for the first three months, compared to a net loss of BD5.68 million ($14.9 million) for the same period last year.

Its total assets surged to hit BD3.31 billion ($8.7 billion), up 7 per cent over BD3.09 billion as of December 31, 2020.

Announcing the results for the three-month period ended March 31, Ithmaar Bank said its net profit attributable to equity holders stood at BD0.15 million compared to BD6.71 million net loss attributable to equity holders for the same period last year.

The bank’s financial results show its cost of funding declined significantly, with profits paid to banks, financial and other institutions during the three-month period ended March 31, reducing to BD15.42million, a 36 percent reduction compared to BD24.09million in the same period last year.

They also show that total expenses remain well under control, decreasing to BD17.14million for the three-month period ended 31 March 2021, a 1.9 percent reduction compared to BD17.47million, despite continued investments in further enhancing products, services and the customer experience.

On the results, Chairman Prince Amr Al Faisal, said: 'Despite the continuing economic challenges imposed by the ongoing global pandemic, the bank has started the current year on a positive note, reporting profits for the quarter and continuing to improve its customer offerings.'

'This further reinforces our confidence that the bank is on the right track, and takes us another step closer to realising our shared vision of becoming one of the regions’ leading Islamic retail banks,' he said.

Ithmaar said it continues to focus on further enhancing its customers’ Islamic banking experience.

Just before the start of Ramadan, the bank had announced that its customers could get their salaries in advance, instantly and directly from their mobile phones, by using the bank’s dedicated mobile application (App).

The service, which was launched as part of the bank’s digital transformation strategy, is a first of its kind in Bahrain and uses sophisticated technology to automate the entire process; from the initial application through to the review, evaluation, approval and even disbursement of funds. In doing so, it provides a uniquely fast and efficient solution to customers and demonstrates the dramatic potential of using technology to enhance banking services.

Ithmaar Bank CEO Ahmed Abdul Rahim said despite the ongoing economic challenges, it continues to grow, particularly in the key, customer-focused areas.

'This is reflected in the continued growth of customer deposits, a key indicator of market confidence in the bank, despite the extraordinarily turbulent economic conditions,' he added.

Abdul Rahim pointed out that despite current market conditions, the equity of unrestricted investment account holders remained stable at BD1.28 billion as of March 31, with a minor increase of 0.5 percent increase compared to BD1.27 billion as of December 31, 2020.

'Customers’ current accounts also grew to BD708.25 million, up 7 percent compared to BD661.74 million last quarter,' he added.