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Bank of Palestine Announces 2013 Results - Net profit of USD 40.4 Million Continuing its Positive Upward Trend

RAMALLAH, Palestine, February 13, 2014 /PRNewswire/ --

Bank of Palestine (BOP), the leading Palestinian bank, reported its preliminary and unaudited financial results for 2013. 

     (Photo: http://photos.prnewswire.com/prnh/20140213/668584 )

Results Highlights

  • Profit before tax reached USD 53.04 million in 2013, an increase of 6.15% compared with USD 49.97 million in 2012
  • 2013 net profit of USD 40.4 million, up 5.45% compared with USD 38.3 million in 2012
  • Operating Income of USD 113 million, up by 10.7%
  • Total assets up 17.14% at USD 2.35 billion compared with USD 2 billion at the end of 2012
  • Loans at USD 1.1 billion, up 13.03% compared to USD 976 million at the end of 2012
  • Customer deposits at USD 1.75 billion, up 12.29% from USD 1.55 billion at the previous year-end
  • Total shareholders' equity reached USD 252 million, an increase of 14.05%

Commenting on the bank's performance, Hashim Shawa - Chairman and General Manager of Bank of Palestine said: "I am pleased to report that Bank of Palestine has continued its upward trend achieving sustainable profitable growth. The year 2013 was not an easy year on many fronts in Palestine. However, despite the economic and political challenges we face operating in this environment, BOP was able to achieve positive increases in our main KPIs, which is attributed to the resilience of the bank and that of its clients, in addition to the bank's sound strategies, solid risk management and control functions, and strong brand."

Results

Bank of Palestine reported profit before tax of USD 53,037,996 in 2013, an increase of 6.15% compared with 2012.  The bank's net profit for the same period reached USD 40,438,831, an increase of 5.45%. As at the end of 2013, Bank of Palestine's total assets increased by 17.14%, to reach USD 2,348,045,943 - maintaining the top rank as the largest Palestinian company in terms of financial assets. Total shareholders' equity reached USD 252,018,974, an increase of 14.05% compared with 2012, and paid-up capital also increased by 11.94% to reach USD 150,000,000. During this period, customer deposits reached USD 1,745,563,265, an increase of 12.29% compared with 2012 and the loans' portfolio reached USD 1,103,641,018 compared with USD 976 million at the end of 2012, an increase of 13.03%.

Branches

The bank continued its commitment to provide wider access to finance and transacting services. Bank of Palestine continues to be Palestine's leading bank in terms of banking network, with 50 branches making up around a quarter of all bank branches in Palestine. In 2013, the bank relocated from two of its branches to newly constructed flagship buildings in the historical cities of Bethlehem and Jericho.  The flagship buildings provide clients with state of the art retail, SME and business banking branches. Additionally, the buildings include fully equipped training centers and conference facilities.  In addition, two sub-branches were opened last year; one in the village of Bedya in the Salfit governorate and the other in the town of Bani Shuheila in Khan Younes. In 2013, the bank also started a project to renovate and modernize its existing branches in order to provide clients with a comfortable banking environment.

Initiatives, Products, and Services

As a customer-driven organization, Bank of Palestine continued to develop its products, services, and campaigns to meet various client needs and to increase banking awareness, especially among children and youth, who represent 75% of the Palestinian society.

As part of the bank's strategy to provide access to finance to all segments of society, BOP continued working on re-structuring and designing a programme for the micro, small, and medium enterprises (MSME) segment, as it makes up 90% of the Palestinian economy.  Similarly the bank is working to target another untapped and under-banked segment, by developing a full banking programme for women in order to meet their needs through banking and non-financial advisory services.

To maintain sustainable and long-term performance and growth, Bank of Palestine continued to focus on risk management. BOP is seeking to implement advanced methods in risk management to apply Basel II and III.  To implement this project, the bank signed an agreement with the International Finance Corporation (IFC) in order to seek best international practices.

Several initiatives were undertaken to promote the cards and plastic business; BOP partnered with one of Palestine's largest retail chain stores to further promote the bank's local instalment card "EasyLife" by introducing a co-branded card that offers clients additional benefits. The bank also launched a large campaign promoting its new Visa prepaid card "Cash Card".  During this period, the bank signed agreements with several Palestinian banks to start issuing credit cards for their clients.

As for electronic services, the bank added electronic bill payment services to its online banking platform.  In early 2014, BOP will also be introducing special kiosk machines that allow clients to conduct their banking transactions electronically, in addition to introducing ATM machines that accept cash and check deposits in multiple currencies.

Awards

Bank of Palestine was recognized in 2013 by several prestigious institutions as the "Best Bank in Palestine".  These institutions include: Euromoney, Global Finance, The Banker, EMEA Finance, Banker Middle East, and the Middle East Investor Relations Society.  The bank also received a special Commendation this year for Leadership in the Middle East as part of the "Sustainable Bank of the Year" award by the Financial Times (FT), and the International Finance Corporation (IFC).

Dividends
The bank's preliminary results have been submitted to the Palestine Monetary Authority (PMA), upon approval, the bank's Board of Directors will issue a recommendation to shareholders regarding the dividend distribution. In 2013, the bank distributed USD 26,050,000 from realized profits in 2012 to shareholders; USD 16 million as stock dividends - raising the bank's paid-up capital to USD 150 million - and USD 10,050,000 as cash dividends.

Subsidiary Companies

The contribution to the bank's profit from its subsidiary companies increased in 2013 compared with previous years.  

The bank's subsidiary PalPay® - Palestine Payments - which introduced its services to the public in 2012, was one of the main sponsors of the Cards and Payments Middle East 2013 conference that took place in Dubai.  This sponsorship and participation in the conference has contributed to promoting PalPay® and its services regionally.  The company also continued to sign agreements with additional utility companies in Palestine to allow their clients to make e-payments through the PalPay® system.

Al-Wasata Securities, which has been the fastest growing brokerage company in Palestine has been playing a major role in the acquisition of new investors in the Palestinian market.  The company ranked number one (out of eight brokerage companies) in Palestine with respect to attracting new investors for the seventh year in a row. It now has a 30% market share in terms of number of investors and a 16% market share in terms of trading value and more than USD 460 million worth of shares under management. In 2013, Al-Wasata won the EMEA Finance and the Global Investor ISF awards for Best Broker in Palestine.

Business Environment in Palestine

The year 2013 marked several developments in the Palestinian business environment; in June 2013, MSCI Inc. released a standalone country index for Palestine (MSCI Palestine IMI Index), which is the first step to getting Palestine on one of the broader MSCI indices, ultimately leading to increased foreign investment in companies listed on the Palestine Exchange (PEX); S&P Dow Jones announced in December 2013 that it has added coverage of Palestine to its suite of frontier market indices. The Palestine index is currently a stand-alone country index. Palestine will remain on S&P Dow Jones Indices watch-list for potential future inclusion in the S&P Frontier BMI and Dow Jones Global Total Stock Market. In the same context, FTSE is reviewing the eligibility of including Palestine as a Frontier market within the FTSE Country Classification scheme.

Moreover, in 2013, the Deposit Insurance Corporation Law was enacted, with the aims to safeguard small depositors, maintain the stability of the banking system, and thus mobilize more savings that would enable banks to play a bigger role in the economy. As a result, the Palestine Monetary Authority (PMA) joined the International Association of Deposit Insurers (IADI).

2014 Economic and Business Outlook

Palestine's economy is expected to continue its steady growth during 2014, especially with the serious efforts and recent initiative of US Secretary of State John Kerry to broker a final-status peace agreement. This peace initiative that involves both political and economic arrangements is expected to positively affect Palestine's economy leading to a rapid expansion. A peace agreement would stimulate Palestine's economy by encouraging foreign direct investment, expanding donor aid to the Palestinian Authority and prompting Israel to ease mobility and trade restrictions. With its existing network and structure, Bank of Palestine is very well positioned to benefit from this positive momentum. These major developments and their potential outcome will only contribute to even more positive results for the bank, since our business strategy has been built factoring in existing market conditions.

2013 Preliminary Financial Results

For more information on the 2013 preliminary financial results, please visit the links below:

English:

http://bop.ps/ir/files/preliminary_results_en_2013.pdf

Arabic:

http://bop.ps/ir/files/preliminary_results_ar_2013.pdf

About Bank of Palestine (BOP)

Bank of Palestine has a long embedded presence and experience in Palestine dating back to 1960.  The bank is now the largest Palestinian bank with the most widespread branch network in Palestine, a paid up capital of $150 million, and assets of over USD 2.35billion, with 1,212 employees serving around 600,000 customers.  Operating as a universal bank, BOP is engaged in retail, corporate, micro and SME, and Diaspora banking operations, with the largest card processing operations in Palestine; BOP is the sole agent for issuing and acquiring Visa and MasterCard in Palestine with over 5,000 Point of Sale merchant terminals nationwide.  BOP also been plays a leading role in the large project finance loan syndications in Palestine. Bank of Palestine adopts a holistic sustainability strategy and has been the leader in Corporate Social Responsibility (CSR) in Palestine dedicating 5% of its net profit to community development.

Bank of Palestine's stock (PEX: BOP) has been listed on the Palestine Exchange (PEX) since 2005. It is among the market's blue chip stocks, and represents more than 15% of total PEX market capitalization.  

For More Information:

Raya Sbitany
Email: raya.sbitany@bankofpalestine.com 
Mobile: +972 56-979-3900


SOURCE Bank of Palestine

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