Ramallah – the world of the motherland
Arab Bank Group’s net profit after taxes and provisions totaled $ 215.2 million in the period ended September 30, 2020, compared to $ 668.9 million in the corresponding period of 2019, a 68% reduction.
Since the Arab Bank Group’s profits were negatively affected during the first nine months of 2020, as a result of the additional allocations that the bank monitored as a precaution to address the economic slowdown and uncertainty in the region and the world, in addition to the decrease in revenue interest and commissions due to the reduction in global interest rates, the fall in oil prices and the slowdown. Global trade movement due to the closures that the countries of the world witnessed due to the outbreak of the Corona virus.
The bank’s net operating profit totaled $ 808 million, down 22% from the same period last year, due to the decrease in net interest, as well as the decrease in net commissions, in addition to the decrease in the profits of the bank’s affiliates. Customer deposits increased 8% to reach $ 37.5 billion compared to $ 34.7 billion in the same period last year, while credit lines totaled $ 26.7 billion on September 30, 2020, compared to US $ 26.1 billion in the same period last year, with a growth rate of 2%. The bank maintained a solid capital base, reaching a total shareholders’ equity of $ 9.3 billion, and the capital adequacy ratio reached 16.7% at the end of the nine months of 2020, in addition to maintaining comfortable liquidity ratios Of the bank, where the ratio of loans to deposits reached 71.1%, while the coverage ratio of non-performing loans exceeded 100%.
Mr. Sabih Al-Masry, Chairman of the Board of Directors, said: “The global economy has suffered great losses as a result of the Coronavirus outbreak, which has imposed additional burdens on all economic sectors, in addition to a reduction in the growth rate and high unemployment rates. ”
In turn, Mr. Nehme Sabbagh – Executive General Manager of Arab Bank – explained that the Arab Bank Group was affected by the outbreak of the Corona virus, which was also accompanied by falling global interest rates and falling oil prices, and indicated that the bank’s focus during this period was to direct business to maintain the quality of the portfolio Credit lines and high liquidity ratios due to negative future expectations for global economic growth.
Mr. Sabbagh added that Arab Bank has a strong capital base and that additional allocations have been allocated based on the International Financial Reporting Standard No. 9 and in accordance with the expected credit loss model used by the bank, in addition to the provisions that the bank has built as a result of current economic conditions in Lebanon.
In conclusion, Mr. Sabih Al-Masry assured that, despite the negative effects of this epidemic, he is confident in the bank’s ability to contain the impact of this economic crisis, praising the success of the bank’s diversified business model locally and regionally.