Bader Abdul Mohsen Al-Mukhaizeem, chairman and managing director of Kuwait Finance House announced that KFH has achieved a profit of KD 343.7 m for 2006, an increase of KD 98.4 m, or by 40%, including profit for investor depositors of KD 176.4 m, distributed as follows: 8.458% for unconditional investment deposits, 6.578% Al-Sidra deposit, and 5.639% for investment savings accounts.
The Central Bank of Kuwait (CBK) has approved c a capital increase by 25%, at 100 Fils per share, and a premium issue of 900 Fils, all upon obtaining approvals of the competent authorities.
Net profit for shareholders amounted to KD 162 m, thus pushing the rate of return on capital (ROC) to 132%, or by 132 Fils per shares, compared to 97 Fils for last year, assuming the increase of capital since the beginning of the year.
Upon approval of the general assembly and the regulatory entities, the board of directors recommended to grant shareholders with cash dividends by 57%, compared to 55% for last year, and bonus shares of 15%, compared to 12% for last year.
Assets rose in the balance sheet to KD 6.314 b, an increase of KD 1.633 b over the past year, or by 35%. Deposits also rose to KD 3.730 b, an increase of KD 541 m, or by 17% compared to last year.
Meanwhile, shareholders equity totaled KD 702.5 m, an increase of KD 102 m, or by 17% over last year.
"These results reflect the constant success of KFH over the past years, which are based on comprehensive knowledge of the circumstances in the markets and industries in which it operates, as well the policy it follows in diversifying the assets in which it invests, which focus on quality investment of increasing value and high return." Al-Mukhaizeem said, "This also coincides with a similar concentration on studying the risk and mitigation techniques. Announced figures reflect the success of the plans set by the management and implemented by all employees." He added.
Boosting the Leading Position
"In 2006 KFH registered substantial achievements that contributed to enhancing its leading position in Islamic banking, and its presence in global markets, together with its ability to meet its customers' requirements of various segments." He elaborated, "KFH continued to provide financial and investment products and services of high quality. In appreciation of its financial adequacy, growth and constant advancement in innovation of products and high-quality IT base, international rating agencies upgraded KFH' ratings in the various aspects of assessment." He explained, "Furthermore, KFH was awarded by the Banker magazine as the world's best Islamic bank. For the third successive year, it was awarded by Euro Money magazine with the best award in the region, which indicates the appreciation by these parties, which observe the performance of global institutions, of KFH's advanced level." He added.
In 2006 KFH expanded worldwide Ijara "lease" operations. The first Islamic USD 230 m Ijara transaction was organized in cooperation with Kuwait Finance House – Malaysia, to finance the purchase of 6 aircraft to the favor of Asian Air. KFH' stake in Al-Robban Ship Finance Fund was sold with an internal rate of return (IRR) of about 42% for KFH's shareholders and depositors.
On the local market, which Al-Mukhaizeem emphasizes as a top priority in KFH's strategies and action plans, the number of branches rose to 42 after the opening of 7 new branche