Gulf International Bank rebound – $ 38.9 million net income attributable to shareholders
The third quarter of 2021 saw a significant increase in net income attributable to shareholders of the Bank, reaching $ 21.2 million compared to a loss of $ 59.9 million in the same quarter last year. This increase is due to stronger performance across all revenue categories. Net interest income of $ 64.3 million represented an increase of 11%, while fee and commission income of $ 15.4 million represented an increase of 8%. Trading income of $ 8.5 million was the result of a 15% increase driven by favorable market conditions, and foreign exchange income of $ 6.2 million represented a 72% increase in revenue from exchange. Other income of $ 16.5 million, almost 3 times higher, is the result of proactive measures taken in asset recovery and a lower provision charge of $ 14.2 million in the third quarter , compared to $ 94.7 million in the same quarter last year.
Basic and diluted earnings per share attributable to shareholders of the Bank amounted to 0.85 cents US in the third quarter of 2021, compared to a loss of 2.40 US cents for the same period last year . Total comprehensive income attributable to shareholders of the Bank during the quarter of $ 24.1 million compared to a loss of $ 70.8 million reported for the same period last year, attributable to the execution of the strategy of the Bank, which resulted in a significant performance improvement and positive revaluation gains.
In line with the Bank’s strategic direction on income diversification, an increase of $ 54.8 million in non-interest income compared to a $ 5.6 million increase in net interest income. Fee and commission income of $ 48.7 million increased 19% year over year, reflecting the success of the bank’s strategic initiatives with higher revenues from asset management, consulting business, trade-related and global banking transactions. Foreign exchange revenues of $ 16.3 million and trading revenues of $ 28.6 million were significantly higher than in 2020. Trading revenues reflected the strong market rebound in portfolios managed by the Saudi bank (GIB Capital) and based in London (GIB UK). subsidiaries.
Total spending of $ 200.1 million for the period was in line with the prior year. The provision charge for the period of $ 36.1 million, compared to $ 210.0 million in the same period last year, a year in which the bank prudently increased the provisions of its historical portfolio given the high risk induced by the pandemic.
Basic and diluted earnings per share attributable to shareholders of the Bank were 1.56 US cents compared to a loss of 5.81 US cents per share for the same period last year. Total comprehensive income attributable to shareholders of the Bank reached $ 61.7 million compared to a loss of $ 164.0 million for the same period last year.
Total non-minority equity of $ 2,142.3 million (Dec 2020: $ 2,071.8 million) increased 3% and includes capital of $ 2,500 million (Dec 2020: 2 $ 500 million), reserves of $ 425.5 million (Dec 2020: $ 379.2 million) and cumulative losses of $ 783.2 million (Dec 2020: $ 807.4 million) which represent 31% of the capital.
Total consolidated assets at the end of the quarter stood at $ 33.2 billion, up 12% from the level of $ 29.6 billion in December 2020. Cash and other liquid assets, including short-term investments of $ 16.1 billion represented a high and prudent level of liquidity and 49% of total assets. Investment securities of $ 4.8 billion consisted primarily of liquid and highly rated debt securities issued by major financial institutions and regional governments. Loans and advances of $ 11.4 billion increased 9% over the period, in line with the bank’s strategy.
The bank’s funding profile remained strong for the period ended September 30, 2021 with customer deposits amounting to $ 23.3 billion and comprising the majority of total deposits. GIB’s strong funding position demonstrates the confidence of the bank’s clients and counterparties on the basis of its strong ownership and financial strength. The bank’s liquidity coverage ratio of 140.7%, stable net funding ratio of 144.6% and capital adequacy ratio of 16.3% are all well above regulatory limits.
GIB successfully closed a syndicated sustainability loan (SLL) of $ 625.0 million, making GIB the first Bahrain-based bank and the first Saudi-majority bank to close such a facility. The deal was well received in international markets and largely oversubscribed with commitments exceeding the original US $ 500 million by more than twice, reaching US $ 1.1 billion. In view of the high interest rate, GIB decided to increase the amount of the facility to $ 625 million. A diverse group of more than 20 global investors from the United States, Europe, the Middle East and Asia participated in the landmark transaction which incorporates environmental, social and governance (ESG) measures related to reducing carbon emissions, gender diversity and sustainability reporting. The SLL reflects GIB’s focus on raising capital in support of a more sustainable economic landscape for its customers and stakeholders.
The financial statements for the period ended September 30, 2021 have been reviewed by the external auditors, Ernst & Young (EY), and comply with International Accounting Standard (IAS) 34 as amended by the CBB.
Gulf International Bank BSC is a pan GCC universal bank established in 1975 and regulated by the Central Bank of Bahrain. GIB’s services are provided in the GCC and international markets through its subsidiaries: GIB Saudi Arabia, GIB (UK) Ltd. In addition, the bank has branches in London, New York and Abu Dhabi, in addition to a representative office in Dubai.
GIB is owned by the governments of the Gulf Cooperation Council countries, with the Saudi Arabia Public Investment Fund being the major shareholder.
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© Press release 2021