JEDDAH, 9 May 2006 — Bahrain-based TAIB Bank posted a record profit of $18.6 million in 2005, an increase of 122 percent over 2004, while earnings per share increased from 9 cents to 19 cents.
According to the TAIB Bank’s annual report released in Manama recently, total operating income rose to $44 million last year, 63 percent higher than 2004, deposits from bank increased 141 percent from $46 million to $111 million, cash and cash equivalents of over 61 percent from $117 million to $189 million and capital adequacy ratio of 42.5 percent compared to the 8 percent international regulatory minimum and 12 percent required by the Bahrain Monetary Agency.
TAIB’s total assets increased by 12 percent to $435 million at the end of 2005. The increase was mainly a result of the bank’s 61 percent rise in liquid assets, cash and placements with banks — from $117.7 million to $189.6 million.
The bank reported net interest income of $7.7 million in 2005, compared to $0.8 million in 2004.
TAIB Bank chairman, Abdulaziz R. Alrashed, said in a message to shareholders “Our repositioning to become a private bank in 2004 has been a worthy operational endeavor. During the year, we both expanded and enhanced our range of products to suit the growing investment needs of our clients. The performance of all our investment products improved as well. Going forward, more innovative products and services that fulfill our clients’ unique needs can be expected.”
Underlying financial performance, TAIB Bank vice chairman and CEO, Iqbal G. Mamdani, said “TAIB has registered a record turnover of over $1.3 billion in real estate investment products. TAIB and its co-investors made investments comprising five new properties with a combined value of $684 million, and exited from eight with a total value of $665 million.”
He added “the value of real estate investments reached $1.1 billion as at year-end 2005.”
TAIB’s trading portfolio overall recorded a gain of $2.4 million, as compared to a loss of $2 million in 2004, largely due to improved market conditions.
Along with co-investors, TAIB acquired interest in certain properties in April 2004 with the intention to resell. In 2005, the value stood at $21.3 million, as against $33.3 million in 2004.
During 2004, the bank also rented a portion of TAIB Tower, and reclassified the let-out portion of the property as investment property; hence, the let-out portion value at the end of 2005 was $5.2 million, as against $4.9 million in 2004.
In 2005, total equity stood at $149.5 million compared to $143.6 million in 2004.
In 2005, TAIB further added to its array of funds by launching the first Shariah-compliant equity fund in the UK — TAIB Islamic UK Equities Indexed Fund.
In 2005, TAIB significantly expanded its brokerage services. Funds under management, in the area of brokerage services alone, increased 100 percent — from $174 million in 2004 to $350 million in 2005. TAIB Securities, the bank’s Bahrain-based brokerage subsidiary, enhanced its research and service offering, and recorded a turnover of $800 million.