PHOTO
In an interview with CNBC Arabiya TV
Focusing on Core Banking Business for Achieving Sustainable Profitability
Share of Participation Banks in Turkey to Reach 15% by 2025
Kuwait - the Board of Directors and the Executive Management at Kuwait Finance House (KFH) had stressed the importance of restructuring KFH's investments for achieving sustainable profitability, mainly by focusing on core banking business while exiting the non-essential businesses" said KFH-Group CEO, Mazin Saad Al-Nahedh.
Speaking to CNBC Arabiya TV in an interview conducted at KFH's Headquarters, Al-Nahedh added that the Board of Directors approved to sell KFH-Group's interest in its subsidiary Aref Investment Group (AIG) and therefore results of AIG are presented in the consolidated statement of income of KFH as discontinued operations. Further, total assets and total liabilities of AIG are presented as one number in the consolidated statement of financial position in accordance with the requirements of International Financial Reporting Standard - IFRS-5 until completion of sale within one year with possibility of extension for another year. He indicated that AIG is a subsidiary and non-strategic investment for the bank, affirming that exiting from it comes in line with KFH's strategy to strip out non-strategic investments to release capital in efforts to further focus on core banking business.
Al-Nahedh underlined KFH's H1 financial results saying that the bank achieved KD 70.9 million net profits, an increase by 13.6%. Net operating revenues reached KD 166 million, i.e. a growth of 14.4% over the same period last year. Total operating revenues for H1 this year reached KD 322 million i.e. a growth of 4.4% compared to the same period last year. This confirms that KFH is on the right track.
Moreover, he noted that the growth has been achieved due to many reasons, most prominently the focus on financing mega projects such as the leading of the first tranche of KNPC financing worth KD 1.2 billion for the clean fuel project in addition to the fees of some businesses.
He boasted the bank's client base is the largest at the level of the local market. The bank is viewed as the leader of retail banking, indicating the bank's keenness to offer the best eservices that cope with the latest technological developments in the banking field. Also, KFH has the largest ATMs network among local banks. Al-Nahedh stressed the importance of customer service while implementing the best practices for the best interest of clients and shareholders.
In response to the TV's question about KFH-Turkey, he illustrated that KFH has been operating in Turkey since 1989, indicating that KFH-Turkey optimally utilized the development in the Turkish economy. KFH-Turky is the first bank among participation banks in Turkey and the total assets of participation banks account for 6% of the total assets of banks in Turkey, indicating that the Turkish government mapped out a plan whereby the share of participation banks will surge to 15% by the year 2025. This comprises an impetus for further investments in the Turkish market as the future is promising.
He added that the recent incidents with regards to the failed cope in Turkey will diversely impact the investment in Turkey on the short term only, while the medium and long terms will witness robust growth and stability as the government won votes of confidence from its people, which lead to more political and economic stability, thus further lures investors.
Al-Nahedh said that KFH's portfolio in Turkey is in a very good position. He ruled out setting provisions for the short term, expressing the bank's readiness to set any provisions in compliance to the regulations of the Central Bank of Kuwait CBK and the regulatory authorities in the countries in which KFH operates.
Kuwait Finance House (KFH)
KFH was established in Kuwait in 1977 and is enlisted in the Kuwait Stock Exchange. KFH Group is a global pioneer in the field of Islamic banking services, where it offers a wide array of Islamic products and services, not to mention a high standard of innovation and client service.
KFH manages its operations in the GCC, Asia, and Europe through over 446 branches, including KFH-Turkey, in order to offer services for the bank's clients in Turkey, Malaysia, Saudi Arabia, Bahrain, Germany, Jordan, and Dubai.
KFH's mission is to achieve highest levels of excellence and innovation in the field of client service, while developing common interest for all those concerned with the financial institution. KFH's vision is to spearhead the global development in Islamic financial services, and to upgrade the bank into the level of becoming the most sustainable profitable Islamic bank in the world.
KFH's values include cementing leadership through all its businesses, including leadership in the Islamic banking services worldwide, through innovation and in client service and the development of its employees. In addition, KFH is committed to all its procedures, and to setting up long-life partnerships with the concerned authorities.
For more information, please visit: www.kfh.com
© Press Release 2016
