MUSCAT, 29 January 2019
Bank Muscat, the flagship financial services provider in the Sultanate, has proposed 35% dividend for the year 2018. Continuing the bank's strong dividend payment track record, the Board of Directors proposed 30% cash dividend for the year 2018 which is consistent with the cash dividend paid in the last many years. In addition, 5% dividend in the form of bonus shares has been proposed. The bank's Capital Adequacy Ratio (CAR) post the cash dividend payout will be 19.38% which is well above the regulatory minimum of 13.57% as per Basel III regulations issued by the Central Bank of Oman.
The meeting of the Board of Directors chaired by Sheikh Khalid bin Mustahail Al Mashani, Chairman, on Tuesday 29 January 2019, approved the 2018 financial results and dividend payout, subject to approval of the Central Bank of Oman (CBO) and shareholders of the bank.
Shareholders would receive cash dividend of RO 0.030 per ordinary share of RO 0.100 each aggregating to RO 88.422 million on the bank's existing share capital. In addition, they would receive bonus shares in the proportion of 1 share for every 20 ordinary shares aggregating to 147,370,636 shares of RO 0.100 each amounting to RO 14.737 million. The proposed cash dividend and issuance of bonus shares are subject to formal approval of the Annual General Meeting of shareholders and regulatory authorities.
The bank posted net profit of RO 179.63 million for the period ending 31 December 2018 compared to RO 176.82 million reported during the same period in 2017, an increase of 1.6%. Net Interest Income from Conventional Banking and Income from Islamic Financing stood at RO 304.29 million for the year 2018 compared to RO 281.35 million for the same period in 2017, an increase of 8.2%.
Non-interest income at RO 142.45 million was lower by 7.9% compared to RO 154.62 million for the year ended 31 December 2017. Income in 2017 includes one-off investment gain of RO 12.8 million on sale of certain investments.
Operating expenses for the year ended 31 December 2018 at RO 190.34 million was higher by 3.4% as compared to RO 184.08 million for the same period in 2017. Net Impairment and other losses for the year was RO 43.24 million as against RO 43.28 million for the same period in 2017.
Net Loans and advances, including Islamic financing receivables, increased by 7.3% to RO 8,939 million as against RO 8,329 million as at 31 December 2017. Customer deposits, including Islamic Customer deposits, increased by 14.1% to RO 8,463 million as against RO 7,419 million as at 31 December 2017. The main reason for substantial increase in customer deposits in the last quarter of 2018, was due to an increase in short term deposits which are transit in nature. The basic earnings per share was RO 0.061 in 2018 and 2017. The complete set of financial statements, which are subject to Central Bank of Oman approval, are available in the Muscat Securities Market website.