The Banking Executive Magazine - February 2025 Issue

Bahrain's Al Salam Bank NET PROFIT GROWS 40% TO RECORD $156.5MLN Bahrain-based Al Salam Bank has achieved record profitability with net profit attributable to shareholders in- creasing by 39.8% to $156.5 million for the fiscal year ended December 31, 2024, up from $112 million in 2023. The substantial growth in profitability was predominantly driven by the strong performance of the group’s core banking operations, sub- sidiaries, and associates as well as the successful acquisition of Kuwait Finance House – Bahrain (KFH- Bahrain), the group’s fifth banking M&A transaction. Maintaining its position as the largest Islamic bank in Bahrain, the group’s balance sheet expanded significantly with total assets growing by 37.2% to $18.73 billion in 2024, from $13.65 billion in 2023, driven by the successful implementation of key growth initiatives in banking. The group’s financing portfolio increased by 36.8% to $9.71 billion while cus- tomer deposits increased by 41.7% to $13.12 billion. While total equity attributable to shareholders ex- panded by 6.8%, return on average equity increased significantly to 15.7% in 2024, up from 13.2% in 2023. The group set a new benchmark in the M&A space, having completed the fastest and most seamless bank- ing transition in the region following the acquisition of KFH-Bahrain from Kuwait Finance House Group in H1 2024. Completed in record time, the integration ensured uninterrupted services for clients while creating new avenues for growth and innova- tion. During the year, the group also launched ASB Capital, its asset man- agement arm headquartered in the Dubai International Financial Centre (DIFC), with a starting AUM of $4.5 billion in assets under management (AUM). In light of the strong financial per- formance, the Board of Directors rec- ommended a dividend distribution of 14% of issued and paid-up share capital (6% cash dividends and 8% stock dividends), aggregating $99.6 million and reflecting an increase of 20% from 2023. This recommenda- tion is subject to AGM and regula- tory approvals. Shaikh Khalid bin Mustahail Al Mashani, Chairman of Al Salam Bank, commented: “Our exceptional performance in 2024 demonstrates the effectiveness of our long-term strategy and the hard work, dedica- tion, and collective efforts of our team. Our focus for the coming pe- riod will be on exploring new oppor- tunities, especially in banking, taka- ful, and asset management, to solid- ify our position as a leading and diversified regional financial group. Our commitment to create long- term, sustainable value for our share- holders and our wider stakeholder base remains at the core of our strat- egy as we navigate an increasingly dynamic and competitive industry.” Rafik Nayed, Group Chief Executive Officer of Al Salam Bank, added: “We are proud of our achievements in 2024 having completed several key strategic initiatives which have cemented our position as a leading diversified financial group. Over the course of the year, we successfully completed the acquisition and seam- less integration of Kuwait Finance House - Bahrain in record time, launched the Group’s asset manage- ment arm (ASB Capital), strength- ened capitalization, expanded our balance sheet, and significantly in- creased profitability to record levels. Looking ahead, our strategic plan in- cludes initiatives to drive efficiencies through AI and digital adoption, sig- nificant market share acquisition across Group companies, and the launch of new verticals to further di- versify, optimize, and increase prof- itability.” the BANKING EXECUTIVE 40 ISSUE 194 FEBRUARY 2025