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BankMuscat Shareholders Approve Annual Results
of the Bank. New Board of Directors elected.
Muscat. March 24, 2007: BankMuscat (SAOG),
the nation’s premier bank, successfully
concluded its Annual General Meeting and an
Extraordinary General Meeting in the capital
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 2006. The shareholders also
approved the Board of Director’s recommendation
to distribute cash dividends at the rate of
(35%) of the issued share capital of the Bank
(being 35 Baisa per share) and stock dividend at
the rate of (10%) per share of the issued
capital of the Bank (being 1 bonus share for
each 10 shares held) for the financial year
ended 31 December 2006.
The Annual General Meeting also saw the
shareholders successfully elect a new Board of
Directors for the Bank for another three-year
term.
The Extraordinary General Meeting, which
preceded the Annual General Meeting the
Shareholders, approved the Bank’s proposal to
raise long-term funds up to a maximum of RO. 250
million through the issue of senior or
subordinated bonds. They also agreed to
authorize the Board of Directors of the Bank to
determine the currency, tenor, size, timing and
terms of subscription of each issue of bonds,
provided however, that the total bonds offered
are issued and subscribed in full within five
years from the date of the approval of the
Extraordinary General Meeting of the
Shareholders.
It may be recalled that BankMuscat declared its
audited financial results in January this year
prior to approval of the shareholders. The Bank
achieved a net profit of RO 60.4 million for the
year ended 31 December 2006, as against a net
profit of RO 45.4 million for the year ended 31
December 2005, an increase of 33%.
Net interest income increased by 27.5% from RO
78.1 million in 2005 to RO 99.5 million in 2006.
Non-interest income grew from RO 23.3 million in
2005 to RO 31.1 million in 2006, an increase of
33.5%. Operating profit of RO 77.3 million in
2006 is 34.9% higher than the RO 57.3 million
achieved in 2005. Operating expenses of RO 53.3
million in 2006 are higher by 21% than RO 44.0
million incurred in 2005. The Cost to Income
ratio for the year was at 40.8% as compared to
43.5% in 2005.
The return on average assets improved from 2.3%
in 2005 to 2.4% in 2006. The return on average
equity improved from 20.2% in 2005 to 21.9% in
2006. The basic earnings per share increased
from RO 0.058 in 2005 to RO 0.073 in 2006, which
works to be a return of 73% on a nominal value
of a share.
The Bank’s net loans and advances portfolio grew
by RO 463 million or 33.7% to RO 1,835 million
as at 31 December 2006 compared to RO 1,372
million as at 31 December 2005. Customer
deposits increased by RO 526 million or 40.7% to
RO 1,817 million as at 31 December 2006 compared
to RO 1,291 million as at 31 December 2005.
Savings deposits increased by 26% from RO 338
million as at 31 December 2005 to RO 426 million
as at 31 December 2006.
The Bank made loan loss provisions of RO 18.4
million during the year compared to RO 24.4
million made during the year ended 31 December
2005. Loan loss provision charge of RO. 18.4
million for the year 2006 includes RO. 8.9
million towards general loan loss provision as
per the requirement of Central Bank of Oman. As
of 31 December 2006, the Bank has fully met the
general loan loss provision requirement of
Central Bank of Oman. The Bank holds a general
loan loss provision of RO 31.1 million as at 31
December 2006. During the year 2006, the Bank
recovered RO 7.3 million from provision for
possible credit losses compared to RO 15.9
million in 2005.
The Bank’s associates contributed RO. 4.1
million as share of profits during the year 2006
as against a RO. 3.7 million of 2005.
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