Arab Banking Corporation reports $26m profits

29 October 2009

Institution hit by provisions of $1bn in 2008

Bahrain-based Arab Banking Corporation (ABC) has reported profits of $26m in the third quarter of 2009, following a $182m loss in the same period of 2008.

The results indicate the bank is gradually returning to profitability after reporting a loss of $836m in 2008. So far in 2009 it has made a profit of $80m. In the third quarter it made total revenues of $167m.

The bank made provisions of $33m in the third quarter and said total deposits increased by $0.8bn in the third quarter, to reach $27.2bn.

The bank was hit by provisions of more than $1bn in 2008 from its investments in structured products such as collateralised debt obligations (CDOs) and structured investment vehicles (SIVs).

“In light of the current adverse market conditions, ABC continues to de-risk the balance sheet and is maintaining its cautious approach especially in its wholesale banking businesses, even though liquidity is improving,” according to a bank statement.

ABC is owned by the Kuwait Investment Authority, the Central Bank of Libya and the Abu Dhabi Investment Authority.

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