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BankMuscat Shareholders Approve Annual Results
of the Bank
Muscat. March 22, 2008: BankMuscat (SAOG),
the nation’s leading financial services
provider, successfully concluded its Annual
Ordinary General Meeting today. The shareholders
of the Bank duly considered and approved the
report of the Board of Directors, the report on
Corporate Governance and the Auditor’s Report
and financial statements of the Bank for the
financial year ended 31 December 2007. The
shareholders also approved the Board of
Director’s recommendation to distribute cash
dividends at the rate of (50%) of the issued
share capital of the Bank (being 50 Baisa per
share) for the financial year ended 31 December
2007.
It may be recalled that BankMuscat declared its
audited financial results in February this year
prior to approval of the shareholders. The Bank
achieved a net profit of RO 84.2 million for the
year ended 31 December 2007, as against a net
profit of RO 60.4 million for the year ended 31
December 2006, an increase of 39.4%.
Net interest income increased by 25.1% from RO
99.8 million in 2006 to RO 124.8 million in
2007. Non-interest income grew from RO 30.8
million in 2006 to RO 48.1 million in 2007, an
impressive growth of 56.2% as a result of
increased business volumes, product cross
selling and new products & services. Operating
profit of RO 102.6 million in 2007 is 32.7%
higher than the RO 77.3 million achieved in
2006. Operating expenses of RO 70.3 million in
2007 are higher by 31.8% than RO 53.3 million
incurred in 2006. Increase in operating expenses
was attributable to increase in salary costs and
other administrative costs due to expansion of
delivery network, products and business lines.
The Cost to Income ratio for the year was at
40.6% as compared to 40.8% in 2006.
The return on average assets was at 2.35% in
2007 as compared to 2.4% in 2006. The return on
average equity substantially improved from 21.9%
in 2006 to 25.8% in 2007. The basic earnings per
share increased from RO 0.066 in 2006 to RO
0.090 in 2007, which works to be a return of 90%
on a nominal value of a share.
The Bank’s net loans and advances portfolio grew
by RO 852 million or 46.4% to RO 2,687 million
as at 31 December 2007 compared to RO 1,835
million as at 31 December 2006. Customer
deposits increased by RO 505 million or 27.8% to
RO 2,322 million as at 31 December 2007 compared
to RO 1,817 million as at 31 December 2006.
Savings deposits had an impressive growth of
53.5% from RO 426 million as at 31 December 2006
to RO 654 million as at 31 December 2007.
The Bank made loan loss provisions of RO 17.8
million during the year compared to RO 18.4
million made during the year ended 31 December
2006. Loan loss provision charge of RO 17.8
million for the year 2007 includes RO 9.2
million towards non-specific loan loss
provisions as per the requirement of Central
Bank of Oman. The Bank holds a non-specific loan
loss provision of RO 40.2 million as at 31
December 2007. During the year 2007, the Bank
recovered RO 7.7 million from provision for
possible credit losses compared to RO 7.3
million in 2006.
The Bank’s associates contributed RO. 5.5
million as share of profits during the year 2007
as against a RO. 4.1 million in 2006.
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