BankMuscat Declares Net Profit Of RO 20.4 Million ‎
For The First 9 Months of 2003‎

‎•‎ Net Profit up 10% to RO 20.4 million
‎•‎ Net Interest Income up by 16% to RO 52.2 million
‎•Total customer deposits up by 5% to RO 1070 million. Savings deposits up 27% ‎to RO
•97 million
‎•EPS of 528 baiza
‎•Commands 33% in terms of total assets, 37% in terms of total credit, 34% of ‎total customer deposits and 31.9% in terms of saving deposits as on 31 August ‎‎2003.‎

Muscat.October 2003: BankMuscat has achieved a net profit of RO.20.4 million for the first nine ‎months of 2003 as against a net profit of RO 18.5 million during the first nine months of 2002 - recording ‎a growth of 10%. ‎

During the period in question, net interest income has grown by 16% from RO 45.1 million to RO 52.2 ‎million for the nine months ended September 30, 2003. Non-interest income has also grown by 20% - ‎from RO 12.3 million to RO 14.7 million. Operating profit at RO 37 million has grown by 23% as ‎compared to RO 30.2 million for the nine months ended September 30, 2002. Operating expenses have ‎increased by 10% as compared to the corresponding period last year, due to the introduction of new lines ‎of business and new initiatives in the area of Information Technology.‎

The Bank has made a loan loss provision of RO 17.4 million during the first nine months of 2003 as a ‎measure of prudence against RO 10.5 million made during the first nine months of 2002. The Bank has ‎been able to effect recoveries of RO 4 million as of September 30, 2003 as compared to RO 1.9 million as ‎of September 30, 2002.‎

The basic earnings per share on an annualized basis works out to 528 baiza for every one Rial share of the ‎Bank. This works out to a return of 52.8% on an annualized basis on share capital.‎

Total customer deposits grew by 5% from RO 1,018 million as of September 30, 2002 to RO 1,070 ‎million as of September 30, 2003. Savings deposits registered an impressive growth of 27% from RO 155 ‎million as of September 30, 2002 to RO 197 million as of September 30, 2003. The Bank’s gross Loans ‎and Advances portfolio grew by RO 8.7 million or 1% to RO 1,325 million as of September 30, 2003 as ‎compared to RO 1,316 million as of September 30, 2002.‎

Speaking on the Bank’s performance AbdulMalik bin Abdullah Al-Khalili, Chairman, BankMuscat ‎‎(SAOG) said: ‎
‎"At BankMuscat we are committed to growth and providing the best returns to our family of ‎valuable stakeholders. The results for the third quarter and over the first nine months of the ‎year are testimony to our continuing endeavour to forge ahead and maintain our leadership ‎position in the Sultanate."


Highlights of the quarter:‎

‎•During the period in question, BankMuscat was a key participant of the Oman delegation sent to ‎the recently concluded Annual Meetings of the Governors of the World Bank and International ‎Monetary Fund (IMF) in Dubai. ‎

In a glittering event on the sidelines of the Annual Meetings, BankMuscat received the ‘Best ‎Bank in Oman’ award from Global Finance Inc., New York at the 6th Annual Global Finance ‎Awards. ‎

BankMuscat also signed an agreement with the Arab Trade Financing Programme to open a line ‎of credit to the tune of US$ 35million to finance foreign trade out of the Sultanate. ‎

‎•October 2003 saw the 1st grand draw of BankMuscat’s Al Mazyona scheme, which was held at ‎the Muscat City Centre amid much fanfare. The next grand draw is scheduled for 31 December ‎‎2003. ‎

‎•BankMuscat (SAOG) and Man Investments came together once again to launch a new US$ 20-‎million capital-guaranteed structured product, the Muscat IP320 Limited during the quarter. ‎Muscat IP320 investors stand to enjoy the security of a capital guarantee plus an annual coupon ‎payable for the first three years, calculated on the face value of the bonds. ‎

‎•BankMuscat played a key role in the divestment of the 12.47% Government holding in Oman ‎Cement Company where the issue was oversubscribed 2.77 times. This marks the Government’s ‎first divestment tranche.‎

‎•BankMuscat participated as a Lead Arranger in the USD 130 million loan financing of Oasis ‎LNG Carrier S.A. Largely owned by the Government of Oman, Oasis LNG is expected to be ‎ready by the end of the first quarter of 2004 and will carry LNG produced at the Oman LNG ‎facilities to international off takers. ‎

‎•The Bank has played a significant role as the Lead Arranger and onshore security agent in three ‎power projects: Al Kamil Power, Barka Power and Desalination and Salalah Power projects. The ‎projects have commenced commercial operations, with the Al Kamil Power Company ‎commencing its operations in the period in question. This is after all the three power projects had ‎achieved financial close in 2001.‎

‎•BankMuscat’s operations in Bahrain have penetrated the local market and continue to strengthen. ‎The Bank’s investments in the IT backbone have now started to bear fruit with the new system ‎now having gone online. ‎

‎•‎The proposed acquisition of 26% stake and merger of BankMuscat’s Indian operations with ‎Centurion Bank, a leading new generation private sector bank is expected to be concluded by the ‎end of the year, when the necessary regulatory formalities will come through. ‎

‎•BankMuscat was once again declared the ‘Best Place to Work in Oman’ in the BusinessToday ‎survey 2003. BankMuscat not only won the top honours overall, but also topped each and every ‎one of the parameters that were integral to the survey: the best place to work judged by women, ‎Omanis and the expatriate community. ‎

About BankMuscat:‎
BankMuscat (SAOG) is the largest banking entity in Oman with a strong presence in Corporate ‎Banking, Retail Banking, Investment Banking and Asset Management. ‎

BankMuscat currently has a market share of 33% in terms of total assets, 37% of total credit, 34% ‎of customer deposits and 31.9% in terms of customer deposits in the Sultanate as on 31 August, ‎‎2003. The Bank's total assets (including overseas operations) as of September 30,2003 is USD 3849 ‎million and Shareholders' Funds is USD 432 million. The Bank has a network of 93 branches in ‎Oman, and a branch in Bahrain and India. The Bank is rated Baa3 by Moody’s and BBB by Fitch. ‎

BankMuscat’s long term strategy is to diversify its revenue base and geographical presence, ‎improve delivery channels backed by technology, diversify into bancassurance and leasing, and ‎eventually become a hub for all types of financial services.‎