Bank Al-Jazira Profits Increased to SR205 Million during the 3Q by 13%

Bank Al-Jazira net profit after zakat and tax for rose to SR205 million during the 3Q, compared to SR182 million during the same quarter of the previous year, at a rate of 13%.

This came after the announcement on Wednesday of its interim financial results for the period ended on 30-09-2021 (Nine Months).

The gross operational profit amounted to SR674 million during the 3Q, compared to SR617 million during the same quarter of the previous year, a growth of 9%.

The net profit after zakat and tax during the current period amounted to SR777 million, compared to SR529 million during the same period of the previous year, an increase of 46%.

Profits per share during the current period amounted to SR0.92, compared to SR0.65 during the same period of the previous year.

Net income has increased by 13% mainly due to an increase in operating income by 8%. The increase in operating income is mainly due to an increase in net financing and investment income, net Fees from banking services, net gains on derecognition of financial assets measured at FVOCI and net gain on FVIS financial instruments against a decrease in net exchange income and other operating income.

On the other hand, total operating expenses have increased by 3% mainly due to impairment charge for non-financial asset and increase in other general and administrative expenses against a decrease in net Impairment charge for financing and other financial assets, salaries and employee-related expenses and depreciation and amortization expenses.

Net income has decreased by 19% mainly due to higher operating expenses and absence of a one-time gain on deemed disposal of an associated company that was recorded in previous quarter. However operating income has increased by 6%.

The increase in operating income is mainly attributable to an increase in net financing and investment income, net gain on FVIS financial instruments, net gains on derecognition of financial assets measured at FVOCI and net exchange income against a decrease in net Fees from banking services and other operating income.

For operating expenses there is an increase by 7%. This is mainly attributable to impairment charge for non-financial asset, an increase in other general and administrative expenses and depreciation and amortization expenses against a decrease in other operating expenses and salaries and employee-related expenses.

Net income has increased by 47% due to an increase in operating income by 12% and booking of a gain on deemed disposal of an associated company. The increase in operating income is mainly due to an increase in net financing and investment income, net Fees from banking services, net gains on derecognition of financial assets measured at amortised cost and net gains on derecognition of financial assets measured at FVOCI against a decrease in net exchange income, other operating income and net gains on FVIS financial instruments. For operating expenses there is an increase by 3%.

This is mainly attributable to impairment charge for non-financial asset, an increase in other general and administrative expenses, other operating expenses and rent and premises related expenses against a decrease in salaries and employee-related expenses, depreciation and amortization expenses and net Impairment charge for financing and other financial assets.

Some items have been re-classified to conform to current period presentation.

1-         Net Impairment charge for financing and other financial assets for current quarter is SR158.5 million as compared to SR180.1 million in similar quarter of previous year, a decrease of 12%. And as compared to SR157.9 million in the previous quarter with less than 1% increase.

2-         Net Impairment charge for financing and other financial assets for current period is SR469.2 million as compared to SR475.1 million in same period of previous year with a decrease of 1%.

3-         Profits per share for the current and prior periods have been calculated by dividing net income for the period after Zakat and income tax (adjusted for Tier 1 Sukuk costs) by the weighted average number of shares outstanding i.e. 820 million shares.

4-         During Q2 2021, the Bank issued Tier 1 Sukuk amounting to SR1.875 billion (denominated in US Dollars) which is included as a part of total Equity.