Dubai – MENA Herald: Arab Bank reported net operating income at the end of 2015 of USD 1.1 billion and net income after tax and provisions of USD 442 million compared to USD 557 million in 2014 after having taken legal provisions of USD 349 million. This follows a settlement agreement which was entered into without any admission of wrongdoing and upon terms satisfactory to the Bank with respect to the legal case which was filed against the Bank in New York 11 years ago. The Bank has been setting aside provisions for the case during the past several years which at the end of 2015 stood at USD 1 billion and which will cover the expected obligations under the settlement agreement.

At the same time the underlying performance of the Bank was strong in 2015. Excluding the effect of foreign currency devaluations, loans and advances grew by 3% to reach USD 23.8 billion and customer deposits grew by 3% to reach USD 35.2 billion. Total Group equity stands at USD 8 billion and the capital adequacy ratio is at a healthy level of 14.2%. Liquidity continues to be high with a loan to deposit ratio of 67.6%.

Mr. Sabih Masri, Chairman of Arab Bank, commented that the strong underlying performance of the Bank reflects the success it has had in growing its business across the different markets while at the same time managing risks very effectively. Mr. Masri added that Arab Bank succeeded in growing its operating profit by taking advantage of the broad diversification of its business in Jordan and across the region.

Mr. Nemeh Sabbagh, Arab Bank CEO, stated that the Bank succeeded in growing its revenues and in controlling its expenses which allowed it to achieve a healthy cost-income ratio of 42.3%. He added that the Bank’s loan portfolio continues to be healthy with the ratio of non-performing loans to gross loans improving to 4.8% despite the challenging conditions in the region. Credit provisions held against non-performing loans stood at a comfortable 109%, excluding the value of collaterals held.

Mr. Sabih Masri expressed his full confidence in the Bank’s ability to maintain its leading position regionally and to continue achieving its targeted objectives.

In light of this strong performance, the Board of Directors is recommending the payment of cash dividends of 25%.

The bank’s results are subject to the final approval of the Central Bank of Jordan.