Oman’s Bank Muscat Q1 Net Profit Jumps 59%

Bank Muscat, Oman’s largest lender, missed analysts’ expectations despite posting on Wednesday a 59.1 per cent jump in its first-quarter net profit, as it didn’t repeat a one-off fraud provision that it was forced to make last year.

The bank reported a quarterly profit of 39.76 million rials ($103.3 million) in the three months to March 31 compared to 24.99 million rials in the corresponding period of 2013, a regulatory filing said.

Six analysts polled by Reuters had, on average, forecast a first-quarter profit of 41.6 million rials.

Bank Muscat’s profit in the same period last year was hampered by a 15 million rial provision that it took after being caught up in one of the biggest-ever cyber fraud cases.

It managed to recoup the lost cash through its insurers by the end of last year, with the provision reversed in its full-year numbers.

The fraud targeted prepaid travel cards, which allow users to carry currencies abroad rather than using their debit or credit cards in foreign countries, which can be expensive.

Bank Muscat’s earnings in the first quarter of this year were boosted by a 24 per cent rise in non-interest income to 24.33 million rials. Net interest income gained 4.8 per cent year-on-year to 59.15 million rials.

Impairments climbed 37 per cent to 10.21 million rials in the first quarter of 2014, when compared to the same quarter last year, according to Wednesday’s statement.

Loans and advances rose 8.8 per cent year-on-year to 5.97 billion rials at the end of March, while deposits increased 11.0 per cent over the same time frame to 6.11 billion rials.

Bank Muscat added that it now owned 14.7 per cent of the combined Al Salam Bank-BMI Bank in Bahrain, which completed its merger in the first quarter. The Omani bank had been the largest shareholder in BMI Bank with 49 per cent before the tie-up between the Bahraini lenders.