Bader Abdul Mohsen Al-Mukhaizeem, Chairman and Managing Director of Kuwait Finance House (KFH), has announced a total profit of KD 264.5 million (US$908.4 million) for the third quarter of the current year, an increase of 47% compared to the same period of last year.
Shareholders' stake accounted for KD 124 million (US$426.7 million) of the total profit, an increase of 34%, while assets totalled KD 5.7 billion (US$19.6 billion) an increase of KD 1.6 billion (US$5.5 billion) against the same period last year, an increase of 40%. For the third quarter, deposits amounted to KD 3.5 billion (US$12 billion), an increase of KD 629 million (US$2.2 billion) or by 22% against the same period.
Profit per share amounted to 101 Fils (US$3.47) compared to 87 Fils (US$2.99) for the same period of last year. Assuming adjustment of the profit per share for the third quarter of last year to reflect the impact of capital increase since early 2005, as well as bonus shares issued during 2006, the profit per share is 76 Fils (US$2.61) for the comparative period.
Al-Mukhaizeem stated that financial indicators for the third quarter emerged within the context of steady and continuous growth in KFH's performance for the various activities, confirming the successful style of investments in quality assets of increasing value, with the careful study of risk and risk mitigation.
"In addition, this reflects the flexibility to utilise the opportunities and move into the markets, maximising the profits for depositors and shareholders," stated Al-Mukhaizeem, "The profit also demonstrates the successful action plans set by the management and implemented by all employees. Therefore, these efforts must be continued to maintain KFH's growth trends. Regional and international expansion plans still are high on the priority list for KFH and are always supported in accordance with market input and variant mechanisms," he explained.
"In light of our interest to increase our market share and advance our local market pioneering role, KFH continues to provide benefits in our banking, commercial and investment products. This is in order to promote the national products, therefore supporting the national traders, and providing our customers with first class services. Utilising new technologies to provide excellent customer service and upgrade performance, also represents a priority for KFH," he added.
Al-Mukhaizeem stressed that the high international ratings obtained by KFH, confirms its distinction, as well as high levels of performance, in the many activities and services.
He added that, "KFH has been the focus of the international rating agencies and institutions. Forms of appreciation gained by KFH are diversified, including international agency ratings, and annual awards for local and regional deals." He stressed that such awards and ratings represent an incentive towards further progress to the levels aspired by KFH and its clients.
In addition to the positive results, the Bank's financial adequacy rating has been upgraded from A- to A, and the short-term FC deposits rating was also upgraded from A2 to A1 by Capital Intelligence International Rating Agency. The rating reflects the agency's appreciation of the substantial growth and the multi-form positive development of KFH's positions. The improved rating marked the higher asset quality, its capability to fulfil its obligations, the possession of several good credit and financial characteristics, successful efforts towards international expansion, technology utilisation, and higher profit, despite the sharp competition, as well as adopting a safe policy and risk mitigation methodology.
"This is the highest rating gained by an Islamic bank in Kuwait. It is the outcome of growth and high performance of KFH during the last year and the first half of this year. In its report, the agency stated several reasons to commend KFH, therefore raising its credit rating from its 2005 rating of A-," said Mr Abdul Aziz Al-Rasheed Al-Bader, Risk Department Manager for KFH.
Some of the reasons for the enhanced rating include the strong growth of assets in KFH and its subsidiaries, despite the stiff competition by the new Islamic banks, Islamic products in traditional banks, entry of new banks into the market, the growth and expansion of investment activity outside Kuwait, with a strong momentum through its subsidiaries and equity partnerships. The report commends the achievements of KFH on the level of retail banking. It has strengths in the area of consumer and real estate financing, with the expansion of its presence within and outside Kuwait.
On the international expansions and operations in the global markets, Capital Intelligence commended the efforts of KFH in this arena, mentioning that the Gulf countries and close Middle East region were primarily focused, including Bahrain, Turkey, Oman and the UAE. KFH concurrently headed for far markets such as Malaysia, which is an entry point towards the neighboring countries, and the South East Asian markets in general.
Note to Editor:
About Kuwait Finance House and Kuwait Finance House (Malaysia) Berhad
Incorporated in the State of Kuwait in 1977, Kuwait Finance House (KFH) is listed on the Kuwait Stock Exchange. A market leader in the Islamic banking industry in Kuwait, KFH is involved in Corporate & Investment, Commercial and Retail Banking, including consumer banking, real estate financing, lease financing, trade finance, direct investments and portfolio investing, all of which are conducted in strict compliance with Islamic law. KFH has been accorded an upper medium grade (high creditworthiness) investment credit rating of ¿A2' by Moody's Investors Service, as well as A+ by Standard & Poors. Capital Intelligence International Rating Agency has upgraded the rating of Kuwait Finance House (KFH) to "A" in terms of financial adequacy. Kuwait Finance House (Malaysia) Berhad (KFHMB) is a wholly-owned subsidiary of KFH and was officially opened on 17 February 2006. KFHMB has an initial paid-up capital investment of RM380 million (US$100 million). The Rating Agency of Malaysia has assigned respective long and short term general ratings of AA2 and P1 to KFHMB.