Al Salam Bank Sees Record Profit with 40% Growth in 2024
Al Salam Bank Reports Remarkable Growth in Profit
Al Salam Bank has achieved an impressive milestone in profitability, showcasing a noteworthy increase of nearly 40% in net profit attributable to shareholders. This growth marks a rise to US$ 156.5 million for the most recent fiscal year, up from US$ 112.0 million in the previous year. The factors contributing to this remarkable performance are primarily linked to the strength of the bank's core banking activities, successful strategic initiatives, and the integration of acquisitions like Kuwait Finance House – Bahrain.
Significant Expansion in Financial Metrics
Maintaining its status as the largest Islamic bank in the region, Al Salam Bank has reported a substantial expansion in its balance sheet. Total assets surged by 37.2%, reaching US$ 18.73 billion, compared to US$ 13.65 billion over the past year. This growth can be attributed to the execution of growth strategies that have effectively boosted their financing and deposit portfolios. The financing portfolio experienced a rise of 36.8%, climbing to US$ 9.71 billion, while customer deposits increased significantly by 41.7%, totaling US$ 13.12 billion. Additionally, total equity, which is attributable to shareholders, expanded by 6.8%, indicating solid financial health with return on average equity increasing to 15.7%, compared to 13.2% in the previous year.
Strategic Acquisitions and Initiatives
In the competitive landscape of the banking sector, Al Salam Bank has set a new standard for mergers and acquisitions. Notably, the seamless acquisition of Kuwait Finance House – Bahrain marked a significant achievement, completed in record time with a focus on maintaining uninterrupted services for customers. This strategic move has not only enhanced their market position but also opened up new growth avenues. Furthermore, the bank unveiled its asset management arm, ASB Capital, located in the Dubai International Financial Centre. With an initial asset under management of US$ 4.5 billion, this new division is poised to contribute strategically to the bank's diversified service offerings.
Dividend Distribution Reflecting Strong Performance
In light of the exceptional financial results, the Board of Directors has proposed a generous dividend distribution. The recommended total of US$ 99.6 million, translating to 14% of the issued and paid-up share capital, consists of 6% in cash dividends and 8% in stock dividends, representing a 20% increase compared to 2023.
Leadership Perspectives on Future Growth
His Excellency Shaikh Khalid bin Mustahail Al Mashani, Chairman of Al Salam Bank, expressed pride in the bank's accomplishments, attributing them to a well-executed long-term strategy and the dedication of the team. The future vision focuses on exploring new growth opportunities in banking, takaful, and asset management to reinforce their position as a leading financial entity. The commitment to providing sustainable value for stakeholders is at the heart of their operations.
Further Plans for Innovation and Efficiency
Rafik Nayed, Group Chief Executive Officer, emphasized the bank's agenda for continued innovation and efficiency. The strategic roadmap includes initiatives enhancing their use of artificial intelligence and digital technologies to drive better operational efficiencies. Additionally, there are plans to capture market share across various group companies, enhancing their service portfolio further while working toward improving profitability.
Frequently Asked Questions
1. What was the net profit for Al Salam Bank in 2024?
The net profit for Al Salam Bank in 2024 reached US$ 156.5 million, a growth of 39.8% from the previous year.
2. What were the key factors driving the bank's profitability?
The strong performance in core banking operations, strategic acquisitions, and the implementation of growth initiatives were crucial to its increased profitability.
3. Which acquisitions did Al Salam Bank complete recently?
Al Salam Bank successfully acquired Kuwait Finance House – Bahrain in a seamless transition that set new industry standards.
4. What is ASB Capital?
ASB Capital is the bank's newly launched asset management arm, which is headquartered in the Dubai International Financial Centre with substantial assets under management.
5. How much is the proposed dividend for shareholders?
The proposed dividend distribution amounts to US$ 99.6 million, which is 14% of the bank's issued and paid-up share capital.
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