International Investment Bank (IIB), a globally focused investment bank based in Bahrain operating in line with Shariah principles, today announced its results for the year ended 31 December 2008.
Total Income for the year 2008 is US 30.1 million, mainly derived from investment banking fees generated from the structuring, underwriting and placement of new investments despite the difficult market conditions. Net Income for the year is US 13.5 million.
Net income earned in the fourth quarter of 2008 is US 1.5 million, compared to US 7.1 million in the same period of 2007; the decrease is mainly attributed to the share of IIB in the loss of one UAE based associate company engaged in real estate investments.
Total Assets at 31 December 2008 are US 218.7 million compared to US 257.3 million at year end 2007. The decrease is mainly attributed to the payment in 2008 of payables to investors and payables for deals totaling US 32.9 million recorded as other liabilities at 31 December 2007.
Following the successful share issuance in late 2007 that netted US 138.9 million, IIB has increased its investment portfolio in 2008 by US 26.5 million or 72.6% to US 62.9 million, through the selection of regional equities.
Capital Adequacy Ratio under Basel II was 87% as at 31 December 2008 versus the Central Bank of Bahrains minimum requirement of 12%, demonstrating IIBs ample capacity to increase its investment portfolio in the future from a regulatory capital perspective.
Commenting on the Bank's results, his Excellency Mr. Saeed Abdul Jalil Mohammed Al Fahim, Chairman of IIB, said: The Bank has emerged relatively unharmed from the global financial crisis largely through prudent investing, strict liquidity management and capital conservation strategies.
IIBs asset position demonstrates core strength with 55% of Total Assets represented by cash and short dated murabaha placements with financially sound banks and a further 15% invested in regional listed equities, for a total 70% liquidity position. This strength, coupled with the fact that it had no borrowings, off balance sheet commitments or other exposures throughout 2008, enables IIB to take advantage, at a measured pace, of new opportunities at attractive valuations as and when these arise, although the selection and profitable execution must be subject to heightened due diligence in the forecast market environment.
Commenting on the transactions completed in 2008, Mr. Aabed Al-Zeera, CEO and Board member commented: Our strategy has been consistently to build solid organic and sustainable growth in the manufacturing, financial, energy and real estate sectors in MENA, CIS countries and Europe. During 2008, the fifth year of full operations, IIB has concluded the sell down of two investment offerings that were carried over from 2007. These comprise the real estate development project located in Abu Dhabi and the stake in a leading commercial bank based in Azerbaijan. IIB has successfully structured four investment transactions in 2008, two of which were placed with investors during the year and the remaining two are being carried forward to 2009 for placement with investors only if the economic environment and market conditions improve during 2009.
Mr. Al-Zeera continued: The first investment offering, a significant stake in ARTES, a leading Nissan/Renault vehicle distributor located in Tunisia, has been fully placed during the year. The second offering, also fully placed during 2008, is a stake in a green-field sugar plant to be constructed in the Kingdom of Bahrain.
The Board is proposing to distribute a cash dividend of 7% for 2008, subject to shareholder approvals, while retaining US 5.8 million to further strengthen the Banks capital base.