Chairman of Burgan Bank Group Majed Essa Al-Ajeel

KUWAIT: Burgan Bank Group announced yesterday its first quarter of financial year 2016 results. A solid underlying performance, balance sheet growth and asset quality improvement characterized the group's performance in the first quarter amid the complexity in the regional operating environment. During the first quarter, underlying net income (net income excluding precautionary provisions) reached KD19.1 million despite complex regional operating environment. Reported net income for the first quarter attributed to equity holders of the bank is KD14.3 million and earnings per share is 4.4 fils.

During the first quarter and compared to the same period last year, net interest income grew 7.4 percent to reach KD40.6 million from KD37.8 million reported. Non-interest income dropped mainly due to the reduction in net gains from foreign currencies which dropped to KD1.7 million from KD 7.7 million. As a result, operating income and operating profit before provisions remained flat and reported at KD57.1 million and KD30.2 million respectively. Balance sheet continued to grow, total Assets grew to KD 7.1 billion from KD6.8 billion in 2015. Capital position is strong where CET1 is 10.7 percent while Capital adequacy ratio under Basel III is percent16.4 as of March 31, 2016.

Majed Essa Al-Ajeel, Chairman of Burgan Bank Group said: "2016 started with high volatility in capital markets that negatively affected the sentiment across all levels, despite this, we see Burgan Bank group again emerging as a resilient organization with a solid business performance".

"The solid underlying performance of Burgan Bank group despite the slowdown in its two subsidiaries in Algeria and Iraq proves the diversifications benefits that Burgan Bank Group is reaping," added Al-Ajeel.

"Asset quality continued to improve, non-performing assets (net of collateral) at 1.4 percent while coverage ratio (net of collateral) reached 328 percent," added Al-Ajeel.

Al-Ajeel also said: "Our leading financial indicators continue to point to the right direction. I remain confident and optimistic of the group's strong performance going forward. " "On behalf of the board, I take this opportunity to thank our customers and shareholders for their confidence in our capabilities and our regulators; the Central Bank of Kuwait, for their support. I would also like to thank our executive management team for their leadership and the excellent execution of the corporate strategy, and to our staff for their continued support and commitment," concluded Al Ajeel.

The consolidated financials encompass the results of the Group's operations in Kuwait, and its share from its regional subsidiaries, namely Burgan Bank Turkey, Gulf Bank Algeria, Bank of Baghdad and Tunis International Bank.