Top 10 Performing Banks In The GCC

2. Bank Dhofar: 324%

Oman’s third-largest bank by market capitalisation, Bank Dhofar reported a massive 324 per cent rise.

First-half profits in 2011 were hit by a $68 million provision the bank took after it lost a court case with HSBC Bank Oman and Ali Redha Trading and Muttrah Holding over the ownership of 1.9 million Bank Dhofar shares.

Bank Dhofar made a loss of $11.9 million in H1 2011, bouncing back in 2012 to post net profit of $50.6 million in the six months ending June 30.

“Bank Dhofar registered a loss in 1H2011 and hence a growth rate for 1H2012 is not meaningful. However, last year’s loss is attributable to a legal case that was filed against the bank,” said Raghu.

“The Court has subsequently ruled in favour of Bank Dhofar and the latter is taking legal action to get back the OMR 26.1 mn in question. Not considering the extra-ordinary loss incurred in 1H2011, the YoY growth in net profit at the end of 1H2012 has been 2.3 per cent, with net interest income growing at 6.6 per cent.

3. Bank Al Jazira: 115%

Bank Al Jazira, Saudi Arabia’s smallest lender by market value, posted a whopping 115 per cent rise.

This H1 gain puts the bank at $72.5 million net profit for the year so far.

Riding the Kingdom’s property wave, Bank Al Jazira announced it would provide Shariah-compliant financing to Mizat Development Co. for a $67 million property project in Riyadh in April this year.

4. Alinma Bank: 91%

Saudi’s Alinma Bank posted a 91 per cent rise, ending the first half of the year with $87.8 million in net profit.

Saudi banks are lending prolifically as the government pushes ahead with its plan to invest $500 billion in new housing, infrastructure and industry.

Loan growth continues to be strong in the Kingdom, with credit growth up 14.7 per cent year-on-year in May, according to figures from the Saudi Arabian Monetary Agency.

Alinma Bank, an Islamic finance provider, posted the largest increase in loans out of all the Saudi banks with a jump of 33 per cent year-on-year.

5. Saudi Hollandi: 24.1%

Saudi Hollandi, the Kingdom’s oldest bank, posted a 24.1 per cent profit increase.

The bank ended the first six months of the year with $165.9 million in net profit, up from $133.6 million for the same period in 2011.

The bank attributed the result to lower costs and higher operating income, which rose by 12.1 per cent in the second quarter to $148 million from $132 million in the same period a year earlier.

Customer deposits, at the end of June, stood at $13.3 billion, up 21.9 per cent on the $10.9 billion figure reported at the same point of 2011.

Loans and advances jumped 20.1 per cent year-on-year, with the bank lending $11.1 billion by June 30 versus $9.3 billion one year previously.

6. Burgan Bank: 23%

The first Kuwait-based bank to appear on the list, Burgan Bank reported a rise of 23 per cent for the first half of the year with net profit of $110.3 million.

It’s a strong rise for Burgan which recently acquired a stake in Turkish bank Eurobank Tekfen having posted $89.5 million profit last year.

The Kuwaiti banking sector has clawed its way back from its nadir in 2008/2009 when the sector was beset with problems, led by the massive loss at Gulf Bank and rising non-performing loans through the sector.

However, operating profit across the board remains mainly flat owing to weak loan growth rates as Kuwait slowly heals from the crisis.