Venture Capital Bank reports net profit of US$ 4.3 Million for the 6 months period ended 31 December 2013
Venture Capital Bank BSC (c) ("VCBank"), has continued to show profitable performance with the publication of its results for the half year to 31 December 2013 following review clearance by auditors Ernst & Young and approval by the Board of Directors.
The Bank reported a net profit of US$ 4.3 million for the six months period ended 31 December 2013 compared with US$ 5.5 million for the corresponding comparative period in 2012, from total revenues of US$ 10.4 million for 31 December 2013 and US$ 15.2 million for 31 December 2012 respectively.
On a quarterly basis, the Bank posted a net profit of US$ 1.8 million after impairment provisions and fair value loss of US$ 0.85 million during the quarter ended 31 December 2013 compared with US$ 2.5 million net profit after impairment provision of US$ 0.14 million for the prior quarter.
Total revenue for the current quarter was US$ 5.3 million, 3% higher over the previous quarter with income from investment banking activities representing the major portion at US$ 4.9 million (US$ 4.6 million in previous quarter). In keeping with its prudent policy on provisioning, the Bank has maintained a collective provision of US$ 4.0 million as a cushion against potential impairments.
The Chairman of the Board Dr. Ghassan Ahmed Al Sulaiman, in announcing the results, highlighted the rebound to profitability of the Bank and the strong contribution from investment banking activities which forms the bedrock of the Bank's activities and of its solid results. The balance sheet has continued to grow with total assets increasing to US$ 247.1 million compared to US$ 221.5 million at 30 June 2013. Remaining largely unleveraged, total assets principally comprise shareholders' equity which has grown to US$ 205.5 million from US$ 200.5 million at 30 June 2013, a 5% growth on an annualized basis. The Bank's capital adequacy ratio currently stands at a very robust 42.1% compared to the regulatory minimum of 12%, and fiduciary assets under management stands at US$ 957 million compared to US$ 925 million as at 30 June 2013.
Board Member and Chief Executive Officer Mr. Abdullatif Mohamed Janahi also highlighted the Bank's rebound to profitability with eight consecutive quarters of positive results and stressed that the Bank is moving forward with renewed strength and confidence. The Bank has built particular expertise in healthcare, agribusiness, oil and gas, shipping, plus yielding real estate; and in the more economically and politically stable markets of the MENA region in addition to Turkey and the United Kingdom.
Mr. Janahi also reported that the Board and executive management have just successfully concluded an extended Board strategy workshop in Istanbul, Turkey to review the Bank's operational performance and results against the previous strategy and plan, and to discuss and agree the strategic direction and business plan for the future in the light of current regional and global developments and circumstances.
"The strategic workshop and the positive results and successful recent offerings are testimony to the Bank's high standards of performance and the effectiveness of its investment strategy. The Bank will continue to target improvements in revenue growth and operating costs whilst maintaining adequate liquidity to build a solid base for sustained profitability and thus generate good returns for our shareholders and investors. The Bank has an investor base that has been very supportive and we are confident that VC Bank will continue to build on this excellent performance into the future with the guidance and support of the Central Bank of Bahrain and the Board of Directors and by continuing to adapt and capitalize on changes and opportunities in the market," concluded Mr. Janahi.