Tijari declared net profit of KD 17 million for 9 months of 2020
Commercial Bank of Kuwait announced its financial results for the 9 month period ended 30 September 2020. The Bank reported a net profit of KD 17.0 million, an 3% year-to-year growth, compared to KD 16.6 million for the respective period last year. The Bank maintained its prudent policy of allocating a major portion of its operating profit to precautionary provisions, the total provisions held with the Bank against its credit portfolio were KD 205.6 million, as at the end of the 30th September 2020.
Sheikh Ahmad Duaij Al Sabah, the Bank’s Chairman, commented “Due to COVID-19 outbreak globally and Kuwait was no exception, Kuwaiti economy has faced unprecedented challenges which were further weighed by drop in oil prices. Kuwait’s GDP is expected to contract by around 6% in 2020 on the back of an 8% reduction in oil output. These negative impacts of pandemic constrain the Kuwait’s liquidity and put pressure on sovereign spending”.
Sheikh Ahmad reaffirmed “Al Tijari has always stood with Kuwait Government in every step of the relief measures such as a six-month moratorium on individual loans without charging any additional interest or other fees for the deferral period. Similar relief was extended to corporate customers, with deferred interest and instalments for a period of six months, without any additional charges thereon. Al Tijari also contributed to the establishment of a KD 10 million CBK fund to support the State’s efforts to combat the virus”.
Sheikh Ahmad added that during the current pandemic our utmost priority is to ensure well-being of our employees and customers. Bank has deployed all internationally benchmarked protective measures and is rigorously monitoring any breaches. Bank has adopted several measures in the direction of health and safety, to name a few, enabling employees with protective kits, flexible employee work arrangement, seamless unmanned digital banking etc to reduce crowd at branches.
Sheikh Ahmad pointed out that Bank strived to achieve operational excellence during these difficult times wherein Bank was able to deliver the customer demands through its digital initiatives detailed as follows:
1) Implementation of Smart Teller and Deposit Machines equipped with NFC Card verification etc. transformed the traditional branches into unmanned digital 24/7 functioning branches. It enabled customer to self-serve during these COVID-19 period and consequently helped to reduce crowd at the branch.
2) Enhancement of mobile banking such as mobile onboarding of new customers, loan applications, cheque deposit, KYC update etc.
3) Touchless payment initiatives such as mobile digitalized wallet, payment via wearables like FitBit and Garmin.
4) Digitalization of back-end process to empower paper-less and minimal human interaction environment to ensure safety of employee and our customers. This includes but not limited to virtualization of customer database for online access, digitizing documents provided by customers, QR Code based employee attendance and several internal documentation.
The consequences of COVID-19 have impacted adversely on Bank’s performance. Financial highlights of 9 months ended 30 September 2020 are as follows:
- Operating income of KD 96 million and operating profit KD 69 million, decreasing 22% and 19% of 9 month ended 30 September 2019 respectively. However cost to income ratio is efficiently maintained at 28% as compared to 30% of September 2019.
- Net profit of KD 17.0 million as compare to KD 16.6 million of last 9 months of September 2019, delivering a marginal increase of 3% in spite of tough economic environment.
- Customer loans and advances are at KD 2,312 million, an increase of 2%, however total assets at KD 4,512 million with a decrease of 4%, on year to year basis.
- Robust regulatory ratios, comfortably exceeding the Central Bank’s requirement, Capital Adequacy Ratio 17.8%, Liquidity Coverage Ratio of 166.1%,Net Stable Funding Ratio of 107.0% and Leverage ratio of 11.4%
Sheikh Ahmad concludes by thanking all the front-line workers from across all governmental organizations for their exceptional efforts in combating the pandemic, and all the management and staff of the Bank for their dedication and untiring efforts to serve the customers in such an unusual circumstances. Further Sheikh Ahmad wishes health and prosperity to Kuwait and its people.