: In an interview with CNBC Arabia TV, Acting Group CEO at Kuwait Finance House (KFH), Abdulwahab Issa Al-Rushood revealed that KFH benefitted significantly from the acquisition of AUB-Bahrain in terms of financial results.

Al-Rushood said that the financial results have been boosted during the last quarter of 2022, following the acquisition of Bahrain`s AUB on 2 October 2022. He added that the fourth quarter of 2022 witnessed a historic growth of KD 151.9 million, an increase of 101.7% in profits attributable to shareholders compared to the same period last year, while the earnings per share for Q4 of 2022 increased to 10.70 fils from 7.74 fils, an increase of 38.2%, in addition to an increase in total assets, financing receivables, and depositors’ accounts as well as an improvement in key financial indicators.

He added during the interview that due to the KFH successful acquisition of 100% of AUB-Bahrain shares, AUB-Bahrain contributed to the 2022 profits with KD 62.5 million, a contribution rate of 17.5%, which represents AUB Group financial results for the period between the acquisition date on October 2, 2022, until the end of FY 2022.

As for the 2022 key financial indicators, Al-Rushood explained that the Group’s performance continued to improve significantly in 2022, particularly after the successful acquisition, pointing out that net profits reached KD 357.7 million, an increase of 47.0% compared on last year.

• Net financing income reached KD 800.5 million; an increase of 36.7% compared to last year.
• Net operating income reached KD 723.3 million, an increase of 43.8% compared to 2021.

• Financing receivables increased to reach KD 18.8 billion, an increase of 65.9% compared to the end of 2021.

• Total assets increased to reach KD 37.0 billion, an increase of 69.7%.

He pointed out that cost-to-income ratio improved by 32.5% compared to 38.0% in 2021, noting that this improvement was due to the 32.2% increase in total operating income.

In addition, Al-Rushood said that the capital adequacy ratio (CAR) reached approximately 17.66% which is above the minimum Regulators’ requirement, noting that this percentage confirms the solid financial position of KFH.

He also added that KFH topped Kuwaiti banks and listed companies on Boursa Kuwait with a market capitalization exceeding KD 11 bn.

Meanwhile, Al Rushood said that KFH is continuing with existing non-strategic assets and investments as part of its strategy of focusing on core banking business and sustainable profits, pointing out that the exits as at the end of 2022 reached around KD 63.2 million.

He added that the Group’s non-performing financings reached 1.32% at the end of 2022 combining AUB (as per CBK’s accounting principles) compared to 1.6% at the end of 2021.

Al-Rushood pointed out that KFH-Kuwait and the Group achieved a debt coverage ratio of approximately 379% and 341% respectively at the end of 2022.

“The provisions charged on the Group’s income statement during 2022 declined by about 54.1% compared to 2021, when it reached about KD 62.1 million, including provisions of financing, investment and other precautionary provisions.” said Al-Rushood.

Speaking about the contribution of KFH-Turkiye in 2022 net profits, Al-Rushood mentioned that KFH-Turkiye performance was good despite the hyperinflation and its accounting impact, indicating KFH-Turkiye net profit contribution reached about 32.9%.

Regarding the plans to convert the assets and operation of AUB-Bahrain’s into sharia-compliant businesses, he said that the plans to convert some of AUB-Bahrain related businesses and assets to be compliant with Islamic sharia principles have already begun, in particular plans to convert its bonds into Sukuk. Plans are also underway to convert the rest of AUB-Bahrain operations according to an agreed timeframe.