Bahrain-based Arab Banking Corporation (ABC)has posted a 25.5 per cent increase in net profits to $69 million for the first three quarters of 2003, compared with the corresponding period in 2002. Operating expenses increased substantially to $380 million, primarily because the strong euro inflated the costs of Spanish subsidiary Banco Atlanticoin dollar terms.
Provisioning also increased slightly to $91 million due to continued sluggish global economic conditions, and low US interest rates caused a fall in interest income.
However, non-interest income increased by 35 per cent to $277 million, resulting in a healthy growth in total operating income. Assets fell by 2 per cent to $28,600 million. The result, marred by overseas exposure, validates ABC's strategy of refocusing operations on the Arab world
In September, the bank announced a provisional agreement to divest its 55 per cent stake in Hong Kong-based International Bank of Asiaand the following month confirmed its intention to sell its 68.5 per cent stake in Atlantico (MEED 12:9:03). The IBA divestment has not yet been booked.
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