ye 2018 kuwait international bank kscpd512cc3a-3d69-4760-9506... · 2019-12-24 · ye 2018 kib –...

YE 2018 Kuwait International Bank KSCP – Earnings Call

Edited transcript of KIB’s earnings call conducted on Wednesday, 06 February ‘19 at

14:00 KST; 6:00 AM NY and 11:00 AM LONDON

Corporate Participants

Mr. Mohamed Said EL Saka Deputy Chief Executive Officer

Mr. Ajai Thomas General Manager – Financial Control & Planning/ CFO

Mr. Abdullah Alasouse Manager - Investor Relations & Financial Reporting

Ms. Janany Vamadeva Arqaam Capital

YE 2018 KIB – Earnings Call

1 | P a g e

Janany Vamadeva Good afternoon everyone, and thank you for joining us today.

This is Janany Vamadeva and on behalf of Arqaam Capital, I am pleased to welcome

you to KIB’s YE 2018 (4Q’18) earnings conference call.

I have here with me today Mr. Mohamed Said EL Saka, Dy. Chief Executive Officer, Mr.

Ajai Thomas, General Manager Financial Control and Planning/Chief Financial Officer

(CFO) and Mr. Abdullah Al Asouse, Manager Investor Relations & Financial Reporting.

Without any further delay, I will now turn the call over to Mr. Abdullah.

Abdullah Al Asouse Thank you Janany for the brief introduction and good afternoon everyone.

Thank you all for joining us today on our Q4 and year end 2018 conference call.

Please allow me to commence this call today by reading a brief disclaimer while full

disclaimer is available to read on the screens in front of you.

Disclaimer: Statements included or incorporated by reference in this presentation, other

than statements or characterizations of historical fact, are forward-looking statements.

Such forward-looking statements are based on KIB’s current expectations, predictions

and estimates and are not guarantees of future performance, achievements or results.

This presentation contains certain data based on internal management estimates,

which may have not been independently verified by a third party. In addition to the

disclaimer I’ve just read, I request you all to read the full disclaimer text on slide #2 of

our presentation. This concludes our disclaimer for today’s call.

Allow me to take you through the format for today’s call:

Mr. Mohamed Said El Saka, our Dy. Chief Executive Officer provide a brief update on

the Kuwait’s current economic situation, KIB’s strategy updates and full year financial

performance for 2018, followed by a presentation from Ajai, our CFO.

Upon concluding the management presentation, we will address your questions

received through webcast platform. As the case may be, we will make every effort to

answer all the questions received. However, if any questions left unanswered due to

time constraints, or for any follow up questions that you might have, please feel free to

contact us through the KIB’s Investor relations email address, which you can find on our

website or on the last page of our presentation pack.


2 | P a g e

The presentation pack, which is being referred to, is also available for download from

KIB website.

I will now hand over the call to our Dy. CEO - Mr. Mohamed Said El Saka.

Mohamed Said El Saka

Good morning and good afternoon everyone. I would like to take this opportunity to

wish everyone a prosperous 2019.

It is my pleasure and privilege to welcome you to our earnings call for the fourth quarter

which coincides with the performance for the year ended 31 December 2018.

I intend to briefly touch upon the current economic situation prevailing in Kuwait, our

strategy implementation and KIB’s performance during 2018.

Then Ajai will review in detail with you, KIB’s financial performance through the

presentation and we would be happy to answer your questions thereafter.

IMF’s recent estimates shows a weakening in the global expansion, which is a

downgrade from the earlier estimate, citing negative effects of tariff increases trade

tensions between major trading partners which has started to negatively impact

economic activity worldwide, also a “no deal“ brexit and greater than envisaged

slowdown in EMs. Global economy projected to grow at 3.5% this year, down 0.2 % from

earlier forecast. Growth in the Middle East expected to remain subdued. Multiple factors

weighing on the region’s outlook includes weak oil output growth and geopolitical

tensions.

Tightening liquidity conditions worldwide, geopolitical risks in the Middle East and

challenges inherent to sukuk issuance dampened ME sukuk issuances recording a 15%

drop in 2018. Higher demand for funding in GCC countries are expected to improve

issuances in 2019.

Kuwait’s economy is expected to grow in 2019 primarily supported by robust capital

spending outlined by government’s approved budget for the year. Non-oil GDP is also

seen improving, Meanwhile, despite lower oil prices, fiscal policy should remain broadly

supportive, with capital spending expected to continue to rise.

S&P Global Ratings affirmed its ‘AA/A-1+’ long and short-term foreign and local

currency sovereign credit ratings on Kuwait with a stable outlook, in January 2019.


3 | P a g e

As for the strategy and its update;

KIB’s strong financial performance reflects its strong growth in a number of business

areas, in line with its newly implemented strategy. KIB’s new strategy implementation is

forging ahead, taking the customer banking experience to the next level and delivering

much more than just ‘banking’ in the traditional sense. KIB always strive to meet the

ever-changing needs of our customers. For this reason, we adopt cutting-edge

technology and digital solutions that are accessible at any time and any place to truly

satisfy our customers.

Our Bank’s financial performance has been impressive this year both in terms of asset

growth and improved profits.

KIB reported a net profit of approximately 21 million KD for the year 2018; a growth of

18% compared to 2017.

Financing income registered a growth of 20% reaching 89.5 million KD compared to 74.6

million KD in 2017.

KIB’s total assets increased by 253 million KD to reach 2.2 billion KD, a growth of 13%

compared to 2017.

Successful strategy implementation has translated to impressive growth in our financing

receivable portfolio and depositor’s base reflecting greater customer trust. Financing

portfolio grew by over 300 million KD reaching 1.6 billion KD and customers’ deposits

grew by 115 million KD reaching KD 1.3 billion both witnessing double digit growth of

23% and 10% respectively, over last year.

Our asset quality matrices have improved significantly in 2018 mainly due to continuous

efforts in monitoring of existing and new portfolio. Our NPL ratio stood below 1%, which

is one of the lowest among peers. In addition, total coverage ratio at 343% in 2018 is

one of the highest in the region.

KIB plans to increase its distribution to shareholders as the Bank’s Board of Directors has

recommended a cash dividend of 11% i.e. 11 fils per share and bonus of 4% i.e. 4 shares

for every 100 shares; which is subject to the approval by the Bank’s shareholders’

general assembly and regulatory authorities.

I would now conclude my short briefing, and handover the call to Ajai to take you

through our results in detail and answer any questions that you may have.

Thank you very much.


4 | P a g e

Ajai Thomas Thank you, Mr. Mohamed.

Good morning and Good afternoon everyone.

KIB’s strong set of numbers for the financial year ended 31 December 2018 stands

testament to successful implementation/progression of the strategy the Bank has

adopted and looking forward to the next year.

As global growth is slowing, with much of the developed world slowing markedly as

mentioned by Mr. Mohamed earlier. Global equity markets having a significant growth

scare in the last quarter of 2018, with earning expectations and valuations falling sharply

and recovering since then, especially in US, showing volatility is still high and investor

sentiments are fragile. For GCC region however, growth in 2019 looks stronger than 2018,

with Saudi, Kuwait and Abu Dhabi expected to continue to deliver significant fiscal

stimulus this year.

2018 has proved to be rewarding year for KIB which has shown impressive results and

we expect to keep the momentum going forward, which is supported by the current

macro-economic conditions along with our consistent efforts in meeting our strategic

goals adopted in 2015.

Please allow me to take you through the presentation.

Slide #5 of the presentation pack provides a snapshot of our strategy updates.

Slide # 7 provides performance of KIB share price and appreciation to investors’ value

over a period of 1 year. KIB share price as of 31st Jan 2019 stood at 290 fils compared to

264 fils at 31st Dec 2018 and 228 fils at 31st Dec 2017 with average return of 27% when

compared to YE 2017 levels.

Slides #9 to # 13 provides details of financial performance during the year 2018.

Navigating through slide # 9 & 10:

KIB reported stellar bottom line growth of 18% to reach around KD 21 Mln for the year

2018 as compared to KD 17.7 Mln in 2017. This was mainly driven by the topline growth

of financing income, which is 20% to reach KD 89.5 Mln as compared to KD 74.6 Mln in

2017. Strengthening of the Bank’s core business has helped us to achieve this

remarkable performance during the year.


5 | P a g e

Net financing income comprised of 81% of the total operating income during the year

as compared to 76% a year ago reflecting strengthening of core business activities as

KIB does not operate an active investment trading book as per it’s conservative risk

appetite.

The bank has continued its investments in new branding and IT infrastructure in 2018

through upgrades for enhanced digital banking experience while controlling its other

costs. Operating expenses registered a marginal increase to support the business

growth. Increase in staff costs is partly reflective of the changes in Kuwait labor laws.

Slides #11, 12 and 13:

These slides provides an overview of the consistent growth in key aspects of the bank’s

core business. Our ALM strategy has helped us to move towards more of an optimum

balance sheet structure, which has shown marked improvements over previous years.

In terms of our core assets/liabilities’ growth, KIB achieved growth in total assets by 13%

to reach KD 2.2 billion in 2018 as compared to KD 1.9 billion in 2017. This was achieved

through growth in financing receivables, which reached KD 1.6 billion in 2018 a growth

of 23% as compared to KD 1.3 billion as at 31 December 2017.

Funding mix have also improved considerably through growth in retail deposit

mobilization, which is aligned with our strategy and long term goals.

KIB’s investment portfolio increased by 14% to reach KD 166 million primarily through

increased exposure towards high quality sukuks, compared to KD 145.7 million by end

2017. Investment income is lower compared to 2017 on account of certain one off

offloads of non-core investments during the previous year.

Customer deposits growth has been sustained due to our various successful product

launches and campaigns supported by attractive profit rates; resulting in an increase

of KD 115 million or 10% to reach KD 1.3 billion compared to KD 1.2 billion by end 2017.

Continuing with the financial performance to Slide #13

Sound capital buffers in line with our prudent risk management places KIB’s ratios well

above the regulatory requirement of 13% in terms of Basel III CAR ratio. KIB’s CAR stood

at 16.6% as of 31 December 2018 while financial leverage ratio stood at 10.5%, well

above the 3% requirement. NSFR was also maintained throughout the year at

comfortable levels compared to regulatory requirements.


6 | P a g e

We would continue to maintain comfortable buffers in line with our current risk

management policies.

Slide #15 shows our commitment to our shareholders with an improved dividend payout

with 11 fils cash dividend in addition to 4% bonus shares for 2018.

Slide #17 summarizes expectations for YE 2019

Thank you. Handing over to the operator.

Operator

Thank you. Ladies and gentlemen, we will now start our question and answer session. If

you wish to ask a question, please type your question into the “ask a question text” area

then click the submit button. Thank you for holding, until we have our first question.

Abdullah Al Asouse We have our first question.

The Bank has a strong growth in Financing Portfolio for the year 2018. What are the

drivers of portfolio growth?

Ajai Thomas

We are pleased with our exceptional growth registered for the year wherein the Bank

registered an impressive growth of 23% during the year 2018. The Bank’s financing

portfolio grew in excess of KD 300 million compared to previous year, well over the

market trend. We are also actively participating in high quality syndications locally and

in GCC region with focus on oil & gas, telecom and hospitality sectors.

Abdullah Al Asouse Operating expenses are grown at over 8%. If that a trend you expect to continue next

year.

Ajai Thomas

As mention in Slide 9 of the presentation, financing income increased by 20% during

2018 compared to 2017 while operating expenses registered a modest growth of 8%.

We expect a similar trend to continue moving forward in 2019.

Abdullah Al Asouse What’s your expectations on the rising share price of the Bank?

Ajai Thomas

We are happy to note that analysts’ coverage of KIB have been mostly positive with

expectation of better share price. Being in the premier market along with FTSE/MSCI

inclusions have supported the share price. Needless to mention, we reported a strong

set of numbers during all 4 quarters of 2018.


7 | P a g e

Abdullah Al Asouse IFRS 9 brought major provisioning costs for banks globally. How has adoption of IFRS 9

impacted the Bank? Would the buffer in terms of ECL result in lower provision charges in

future?

Ajai Thomas

The current regulation requires applying CBK provisions or IFRS 9 ECL whichever is higher

which resulted in comfortable buffers for us. We expect a similar trend to continue.

Abdullah Al Asouse What was the reason behind the decrease of the investment income in 2018?

Ajai Thomas

As mentioned during our presentation, KIB’s investment portfolio increased by 14% to

reach KD 166 million primarily through increased exposure towards high quality sukuks,

compared to KD 145.7 million by end 2017. Investment income is lower compared to

2017 on account of certain one off offloads of non-core investments during the previous

year.

Abdullah Al Asouse We see large cross-country and national M&A activities resulting in consolidation of

financial institutions. Any plans for such initiatives?

Ajai Thomas

We are currently focused on organic growth in line with the strategy and have no

immediate plans to enter M&A space.

Abdullah Al Asouse Here’s another question.

Ajai, What is the outlook for retail deposit growth?

Ajai Thomas

We are continuing our efforts to become the “Bank for Life” in line with our strategy and

as part of that, we provide our customer with a better banking experience. Customer

deposits registered a growth of 10% in 2018 compared to 2017, largely due to our

success in improving retail base, acquiring higher volumes through our innovative

deposit products launches and various promotional campaigns supported by better

profit rates. In equation, this mainly contributed to higher customer trust and better

brand visibility within the market.

Operator

Ladies and gentlemen, I would like to remind you. If you wish to ask a question, please

type your questions into the “ask a question text” area then click the submit button.

We have another question.


8 | P a g e

Abdullah Al Asouse Kuwait’s Ministry of Commerce and Industry issued a decision in December 2018 to

allow increased foreign ownership in banks to 100% from 49%, what are your views on

the same. Also, how is the Bank positioned to attract foreign ownership?

Ajai Thomas

In my view, increasing foreign ownership will boost investors’ confidence in the market,

which will help bring in additional foreign investments further reducing dependency on

oil-based economy. Currently we are seeing strong interest of FII in our stock, as of

December 2018 the holding was at around 7%, which is second highest among Kuwaiti

banks.

Abdullah Al Asouse Have you been active in fintech and blockchain technology initiatives?

Ajai Thomas

We have a full-fledged omni-channel platform for our customers. We are evaluating

various fintech opportunities and will have a technology onboard only if it provides

significant synergies in operations and customer experience.

Abdullah Al Asouse We have noted that the Bank has reported a significant improvement in asset quality.

Could you shed some light on these improvements?

Ajai Thomas

We are pleased to report a significant improvement in our asset quality as reflected in

lower NPL ratio and higher total coverage ratio. As explained by our DCEO earlier, asset

quality matrices have improved significantly in 2018 due to our continuous monitoring

and follow up of existing loan book and new exposures resulting in one of the lowest

NPL ratios in the region; which was below 1%.

Abdullah Al Asouse Here we have another question.

Ajai, we have noted lower provision charge in 2018 compared to last year in spite of a

significant growth in financing receivables, can you please explain reasons for this?

Ajai Thomas Provision charge on financing receivables for 2018 was lower than the previous year.

This is mainly because of better quality assets onboarding along with prompt follow up

of existing portfolio.

Abdullah Al Asouse What will be your investment strategy going forward given the current market

conditions?

Ajai Thomas Increase in investment portfolio during 2018 is mainly because of increased exposure in

high quality sukuks. This expansion is in line with our strategy and helps bank to achieve


9 | P a g e

diversified and optimum balance sheet composition. Going forward we will continue

the same trajectory and explore investment opportunities.

Abdullah Al Asouse Could you please provide arrange of loan growth expectation for 2019?

Mohamed Said El Saka We have registered an impressive growth in the financing portfolio in excess of 23%

compared to 2017. The Bank’s financing portfolio grew in excess of KD 300 million

compared to previous year, well over the market trend. We are also actively

participating in high quality syndications locally and in GCC region with focus on oil &

gas, telecom and hospitality sectors. and expect a similar trend to continue.

Abdullah Al Asouse

Thank you Ajai.

Ladies and gentlemen, we are nearing the close of our allotted time for the call. Please

feel free to get in touch with us at the investor relations contact provided at the end of

the presentation, and we will respond to your inquiries. Any final words, Mr. Mohamed?

Mohamed Said El Saka On behalf of KIB, I would like to thank all the participants and look forward to discuss

next quarter results.

Thank you very much for joining.

Operator This concludes today's conference call.

Thank you for your participation.

You may now disconnect.

INVESTOR PRESENTATION

YE 2018 EARNINGS CALL WEDNESDAY

14:00 KST 06 FEBRUARY 2019

KUWAIT INTERNATIONAL BANK

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06-Feb-2019 2INVESTOR PRESENTATION YE2018

DISCLAIMER

This presentation has been prepared by KIB (Kuwait International Bank KSCP), is strictly confidential and is being furnished to each recipient solely for its own information. It may not be reproduced or

redistributed to any other person, and it may not be published anywhere, in whole or in part, for any purpose. It is expressly forbidden to disclose the information in this presentation to any other person.

No representation or warranty, express or implied, is or will be made in relation to, and no responsibility, liability or duty of care is or will be accepted by the Bank and affiliated persons, or any directors,

partners, officers, representatives, employees, advisers or agents of the Bank (“Relevant Persons”) as to, or in relation to, the accuracy, reliability, or completeness of this presentation or any information

herein. Accordingly, none of the Bank or any Relevant Persons shall be liable for any direct, indirect or consequential loss or damage suffered by any person as a result of relying on the accuracy of any

information or any statement in this presentation or any errors or omissions in this presentation. No responsibility, liability or duty of care is or will be accepted by the Bank or any Relevant Persons for

providing the recipient with access to any additional information, updating this presentation or correcting any inaccuracies herein which may become apparent.

IMPORTANT NOTICE

This presentation has been prepared by KIB and is subject to the applicable laws and regulations in the State of Kuwait. It is for information purposes only and it shall not be reproduced or redistributed to

any other person without obtaining KIB’s prior written consent. It does not and shall not constitute either an offer to purchase or buy or a solicitation to purchase or buy or an offer to sell or exchange or a

solicitation to sell or exchange any securities of KIB. Neither this presentation nor anything contained herein shall form the basis of any contract, commitment or advice whatsoever. This Presentation must

be read in conjunction with all other publicly available information. To the maximum extent permitted by law, KIB and its directors, employees, agents, consultants, affiliates and subsidiary expressly

exclude all liability and responsibility for any loss or damage arising from the use of, or reliance on, the information contained in this presentation or the website whether or not caused by any negligent act

or omission. Neither KIB nor any of its directors, employees, agents, consultants, affiliates, or subsidiary warrant or represent the correctness, accurateness or completeness of the information provided

herein. This document is not to be relied upon in any manner as legal, tax or investment advice. Each recipient hereof shall be responsible for conducting its own investigation and analysis of the

information contained herein and shall familiarize and acquaint itself with, and adhere to, the applicable local legislations. Except where otherwise expressly indicated herein, this presentation contains

time-sensitive information which is based on currently available information to KIB as of the date stated or, if no date is stated, as of the date of this preparation and accordingly does not guarantee specific

future results, performances or achievements. The information and the opinions contained herein are subject to change without notice. None of KIB/its subsidiary or affiliates assume any obligation to

update or otherwise revise any such information to reflect information that subsequently becomes available or circumstances existing or changes occurring after the date hereof.

FORWARD-LOOKING STATEMENTS

All statements included or incorporated by reference in this presentation, other than statements or characterizations of historical fact, are forward-looking statements. Such forward-looking statements are

based on KIB’s current expectations, predictions and estimates and are not guarantees of future performance, achievements or results. Forward-looking statements are subject to and involve risks and

uncertainties and actual results, performance or achievements of KIB may differ materially or adversely from those expressed or implied in the forward-looking statements as a result of various factors. In

addition, even if KIB’s results of operations, financial condition and the development of the industry in which it operates are consistent with forward-looking statements contained herein, those results or

developments may not be indicative of results or developments in subsequent periods. KIB does not undertake to update any forward-looking statements made herein. Past results are not indicative of

future performance.

This presentation contains certain data based on internal management estimates, which may have not been independently verified by a third party. Information has been obtained from various sources and

are provided to assist the recipient in the evaluation of matters described herein. They may be based on subjective assessments, adjustments and assumptions and may use one among alternative

methodologies that produce different results and to the extent they are based on historical information, they should not be relied upon as an accurate prediction of future performance.

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Index

06-Feb-2019

Strategy update 4

KIB - share price trend 6

Financial Performance 8

Dividends 14

Expectations 16

Q&A 18

Annexures 19

Contacts 25

3INVESTOR PRESENTATION YE2018

Strategy Update

06-Feb-2019 INVESTOR PRESENTATION YE2018 4

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Strategy Update (2018 snapshot)


KIB included in Premier Market

segment

“An elite category, which will be occupied

by high caliber companies with high

liquidity and medium to large market

capitalization requirements”

US$ 250 MILLION SYNDICATION

MURABAHA OVERSUBSCRIBED

AFFIRMED LONG-TERM

ISSUER RATINGS A+

WITH STABLE OUTLOOK

April’18 October’18 June’18

NEW BRANDING

Share Price Performance


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170

190

210

230

250

270

290

Dec-17 Jan-18 Feb-18 Mar-18 Apr-18 May-18 Jun-18 Jul-18 Aug-18 Sep-18 Oct-18 Nov-18 Dec-18 Jan-19

(Fils

)

KIB Share Price Trend

06-Feb-2019

Share Price Performance YE 2017 to 31 Jan 2019


31 Dec’17

228 Fils

31 Jan’19

290 Fils

Financial Performance


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Financial Performance Highlights


DOUBLE DIGIT GROWTH IN ALL MAJOR FINANCIAL KPIS

YE2018 YE2017 %

Net Profit attributable to shareholders 'KD Million' 20.9 17.7 18%

Earnings Per Share 'Fils' 22.38 18.96 18%

Financing Income 'KD Million' 89.5 74.6 20%

Total Assets 'KD Billion' 2.17 1.92 13%

Financing Receivables 'KD Billion' 1.60 1.30 23%

Customer Deposits 'KD Billion' 1.32 1.20 10%

Financial Results for year ended 31st December 2018

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Income/ Profitability Trend


74.6 89.5

YE 2017 YE 2018

(KD

mln

)

FINANCING INCOME

17.7 20.9

YE 2017 YE 2018

(KD

mln

)

NET PROFIT

64.3 66.6

YE 2017 YE 2018

(KD

mln

)

OPERATING INCOME

31.5 30.7

YE 2017 YE 2018

(KD

mln

)

OPERATING PROFIT BEFORE PROVISIONS(ATTRIBUTABLE TO SHAREHOLDERS)

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Key Balance Sheet Parameters


1,846 1,916 2,169

YE 2016 YE 2017 YE 2018

(KD

mln

)TOTAL ASSETS

1,268 1,304 1,606

YE 2016 YE 2017 YE 2018

(KD

mln

)

FINANCING RECEIVABLES

1,125 1,203 1,319

YE 2016 YE 2017 YE 2018

(KD

mln

)

CUSTOMER DEPOSITS

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Asset Liability Mix


IMPROVING ASSET LIABILITY STRUCTURE IN LINE WITH STRATEGIC INITIATIVES

15%21%21%

74%68%69%

8%8%7%3%3%3%

201820172016

ASSET MIX

Due from Banks Financing receivables Investments Others

24%21%23%

61%63%61%

2%2%2%

13%14%14%

201820172016

LIABILITY MIX

Due to banks and OFI's Depositors account Other liabilities Equity

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Capital/Liquidity Analysis


20.5%19.1%

16.6%

12.5% 13% 13%

2016 2017 2018

CAR Regulatory Requirement

CAR (Basel III)

108.5%

105.8% 105.9%

100% 100% 100%

2016 2017 2018

NSFR Regulatory Requirement

NSFR

10.7% 10.9%10.5%

3% 3% 3%

2016 2017 2018

leverage ratio Regulatory Requirement

LEVERAGE RATIO

152.9%

169.5%

140.2%

70%80%

90%

2016 2017 2018

LCR Regulatory Requirement

LCR

Dividends


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Dividends


YE 2018 : 11% Cash Dividend (11Fils per shares) &

4% Bonus shares (4 shares for every 100 shares)

YE 2017 : 10% Cash Dividend (10 Fils per share) /Nil Bonus shares

Dividends for the year ended 31st December 2018 as recommended by Board of Directors is subject to the approval of the Bank’s shareholders’ general assembly and regulatory authorities.

2019 EXPECTATIONS


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YE 2019 Expectations


Financing receivables continue to register significant growth

Total assets is targeted to grow in line with strategy

Deposits expected to register significant growth in 2019

Net profit is expected to continue to increase in line with strategy

Operating expenses to marginally increase on account of new strategic initiatives being implemented

?Q&A


Annexures


KIB AT A GLANCE


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SNAPSHOT

BACKGROUND

• In business since 1973, KIB is a publically-traded Kuwaiti bank that in 2007 adapted all its

operations and processes to fully comply with Islamic Sharia’.

• Nationwide network of 24 branches and 96 ATMs

AWARDS

• Best Islamic Bank in Kuwait and GCC – 2018 (World Finance)

• Best Customer Acquisition – 2018 (CPI.co)

• Best Sharia’ Compliant Bank MENA – 2018, 17, 16 & 15 (CFI.co)

• Fastest Growing Islamic Bank MENA – 2018, 17 & 16 (CFI.co)

• Best Branding in Kuwait – 2018 (CPI.co)

• Best Islamic Bank in Kuwait – World Finance 2017, 16, 15 & 14

• Best Customer Acquisition – World Finance 2017

• Best CSR in Islamic Banking – 2017, 16 & 15 (CPI Financial)

• Best Finance team – 2018 (MENA CFO Strategies Forum)

OWNERSHIP

• Listed on the Boursa Kuwait since 1984, Bukhamseen Group Holding & its affiliates hold

35.87% shares of KIB. Govt. of Kuwait holds around 8% through PIFSS as of 31st

December 2018.

• KIB’s market capitalization at 31st Dec 2018 was KD 274 million.

OPERATIONS

• KIB’s business covers all Sharia compliant banking services including acceptance of

deposits, financing, investments, Murabaha (auto, real estate and commodities), Ijara

Muntahia Bittamleek (lease-to-own), Istisna’a, Tawarruq, credit cards, Wakala, and other

products in addition to corporate and project finance, treasury services, issuing letters of

credit and letters of guarantee.

• Subsidiary : Ritaj Takaful Insurance Company, Kuwait

RATINGS • Long- Term IDR “A+” with “Stable Outlook“

06-Feb-2019

KIB AT A GLANCE


FINANCIAL SNAPSHOT

KD million 2018 2017

Total Assets 2,169 1,916

Financing Receivables 1,606 1,304

Customer Deposits 1,319 1,203

Total Equity 277 264

Operating income 67 64

Net Operating profit after prov isions 23 19

Net Profit attributable to shareholders 21 18

Net Profit Margin (%) 1.2% 1.1%

Return on Average Equity (%) 7.7% 6.8%

Tier 1 Ratio (%) 15.5% 17.9%

CAR (%) 16.6% 19.1%

No of Branches 24 26

No of ATMs 96 94

Consolidated Income Statement & Balance Sheet


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Income Statement Consolidated (YE 2018 Vs YE2017)


KWD 000's YE’ 2018 YE’ 2017

Financing income 89,470 74,559

Finance costs and distribution to depositors (35,815) (25,514)

NET FINANCING INCOME 53,655 49,045

Fees and commission income 9,864 9,281

Net gain from foreign exchange 931 861

Investment income 1,571 4,469

Other income 609 595

TOTAL OPERATING INCOME 66,630 64,251

Staff costs (19,089) (17,603)

General and administrative expenses (14,522) (13,288)

Depreciation (2,275) (1,889)

TOTAL OPERATING EXPENSES (35,886) (32,780)

Profit from operations before provisions and impairment losses 30,744 31,471

Provisions and impairment losses (8,244) (12,353)

PROFIT FROM OPERATIONS 22,500 19,118

Taxes, etc. (1,465) (1,325)

PROFIT FOR THE YEAR 21,035 17,793

Profit attributable to Shareholders of the Bank 20,892 17,701

Non-controlling interests 143 92

STATEMENT OF PROFIT OR LOSS (AUDITED)

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Balance Sheet Consolidated (As at 31 December‘18 & ‘17)


KWD 000's 2018 2017

Cash and balances with banks 41,585 19,450

Due from Banks 315,673 402,902

Financing receivables 1,605,833 1,304,416

Investment securities 105,975 83,840

Investment in an associate 1,518 1,518

Investment properties 58,523 60,391

Other assets 10,987 17,298

Property and equipment 28,501 26,225

TOTAL ASSETS 2,168,595 1,916,040

Due to banks and financial institutions 517,537 394,438

Depositors' accounts 1,318,535 1,203,213

Other liabilities 55,919 54,498

TOTAL LIABILITIES 1,891,991 1,652,149

Share capital 103,732 103,732

Share premium 49,480 49,480

Treasury shares (45,234) (45,234)

Other reserves 165,212 152,589

Non-controlling interests 3,414 3,324

TOTAL EQUITY 276,604 263,891

TOTAL LIABILITIES AND EQUITY 2,168,595 1,916,040

STATEMENT OF FINANCIAL POSITION (AUDITED)

Thank you

06-Feb-2019 Private & Confidential

ye 2018 kuwait international bank kscpd512cc3a-3d69-4760-9506... · 2019-12-24 · ye 2018 kib –...

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