Al Baraka Bank Algeria Net Profits Reached DZD 960 Million During the First Quarter of 2016
1 June 2016
Al Baraka Bank Algeria, a subsidiary banking unit of Al Baraka Banking Group B.S.C. (ABG), celebrated the 25th Anniversary of its foundation in 1991 as a first Islamic bank in Algeria. This was coincided with approval by the Board of Directors of the Bank on the financial results for the first quarter of 2016, which showed a 44% increase in net operating income and DZD 960 million net profits.
At the same time, the Board of Directors approved to submit a recommendation to the extraordinary general assembly of the Bank to increase the paid up capital of the Bank from DZD 10 billion to DZD 15 billion. The bank will hold an extraordinary general assembly to approve the decision of the increase in capital.
Regarding the Bank's financial results, the Bank was able, through expanding products and services offered and diversifying income sources, to maintain the income at good levels despite the prevailing economic conditions and the increase of US dollar against the Algerian dinar. As a results of these initiatives, the total income increased by 30% during the first quarter of 2016 to reach DZD 2.25 billion (US$ 21 million) compared to the same period of 2015.
After deducting operating expenses, net operating income increased largely by 44% to reach DZD 1.5 billion in the first quarter of 2016 compared to the same period of 2015, which confirms the Bank's ability to diversify its income sources from commissions, fees and other income sources.
Net income for the first quarter of 2016 reached DZD 960 million (US$9 million) for the first quarter of 2016, increasing by 1% compared to the first quarter of 2015.
On the balance sheet side, total assets of Al Baraka Bank Algeria stood at DZD 202.6 billion (US$ 1.9 billion) as at the end of March 2016, an increase of 5% compared to the end of 2015. Total financing and investments portfolio reached DZD 96.3 billion (US$ 880 million) at the end of March 2016, almost the same level of the end of December 2015.
Customer deposits increased by 7% to DZD 173.15 billion (US$ 1.6 billion) at the end of March 2016, which financed 85% of the Bank' total assets, reflecting the strength of the customer base. The Bank's equity reached DZD 19.6 billion (US$ 180 million) at the end of March 2016.
On this occasion, Mr. Adnan Ahmed Yousif, Chairman of Al Baraka Bank Algeria and the President and Chief Executive of Al Baraka Banking Group expressed his appreciation for these results, praising the large efforts of the executive management and all employees of the Bank, to achieve them.
Mr. Adnan added "I am also pleased on the occasion of the 25th anniversary of the establishment of the Bank to extend to all my colleagues on the Board of Directors of the Group and Al Baraka Bank Algeria, as well as the executive management, employees and customers of the Bank my sincere congratulations, There is no doubt that the Bank has achieved during the last period significant achievements and distinct successes especially in recent years, coincided with a sustained growth in business, profitability and market share, as the Bank occupies today a leading position among Algerian private banks, in addition to being the first Islamic bank in Algeria, which has provided a great service to the economy of Algerian society."
The financial results of the Bank during the first quarter of the year 2016 is a further evidence of the consolidation of the Bank in the Algerian market, where the Bank was able to build on the strong capital resources that is owned, as well as the strong support enjoyed by the parent company, ABG and Agriculture and Rural Development Bank of Algeria, which was represented lately in agreeing to raise the Bank's capital, in order to expand the network of services and increase its human resources and diversify the products offered. These steps have enabled the Bank to make the most of the opportunities available in the growing Algerian market.
For his part, Mr. Mohamed Seddik Hafid Board Member & General Manager of Al Baraka Bank Algeria said that the Bank was able, by the grace of Allah Almighty and thanks to its capital and human resources, to maximize its benefit from available investment and financing opportunities and continued achieving the good results.
He added "The Bank has for some time been active in diversifying its activities into other finance-related avenues. In this regard in 2015 it established the Al Khobrat Real Estate Company and opened the Islamic Banking Training Institute. Meanwhile it opened 2 new branches. It intends to inaugurate a further 2 branches in 2016, bringing its network to 32 branches, and to install ATM machines in all branches. Under its rolling 5-year strategy it plans a total branch network of 50 by 2020.
The Bank intends to create Ijara and Takaful insurance subsidiaries under its Group umbrella in partnership with the Ministry of Religious Affairs and Endowments as specialist units for these products, in addition to an investment fund management company for financing SME business, a services company for management of micro finance products, and an IT services company, as well as to participate in the establishment of a major new hospital in Algiers.
Its plans also include the launch of Internet banking for its corporate and retail customers, e-payment facilities and a new Shari'a compliant MasterCard. It is also seeking to commence mobile banking and to develop facilities to finance car purchase and consumer finance for local products in general.
Al Baraka Banking Group (B.S.C) is licensed as an Islamic wholesale bank by the Central Bank of Bahrain, listed on Bahrain Bourse and Nasdaq Dubai stock exchanges. It is a leading international Islamic banking group providing its unique services in countries with a population totaling around one billion. It is jointly rated BBB+ (long term) / A3 (short term) on the international scale and A+ (bh) (long term) / A2 (bh) (short term) on the national by Islamic International Rating Agency & Dagong Global Credit Rating Company Limited, and by Standard & Poor's at BB+ (long term) / B (short term).
Al Baraka offers retail, corporate, treasury and investment banking services, strictly in accordance with the principles of the Islamic Shari'a. The authorized capital of Al Baraka is US$ 1.5 billion, while total equity is at about US$ 2.1 billion.
The Group has a wide geographical presence in the form of subsidiary banking units and representative offices in fifteen countries, which in turn provide their services through over 600 branches. Al Baraka currently has a strong presence in Turkey, Jordan, Egypt, Algeria, Tunisia, Sudan, Bahrain, Pakistan, South Africa, Lebanon, Syria, Iraq and Saudi Arabia, including two representative offices in Indonesia and Libya.