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Egypt: NBK-Egypt reports EGP 726.7 million in Net Profits in 1H2017

NBK-Egypt - a member of NBK Group – reported EGP 726.7 million in net profits for 1H2017 up 78.4% compared to EGP 407.4 million for the corresponding period in 2016.

Total assets as of June 30,  2017 reached EGP 57.4 million up 41.7% compared to EGP 40.5 million by the end of June 2016. Total customers deposits grew by 34.3% for the same period to reach EGP 42.7 billion, compared to EGP 31.8 billion for the corresponding period of last year. While customer loans and advances reached EGP 25.9 billion as of end of June 2017, growing at 59.9% year-on-year, compared to EGP 16.2 billion for the corresponding period in 2016.

Isam Jassim Al-Sager, NBK’s Group Chief Executive Officer and NBK-Egypt Chairman said that the strong growth achieved by NBK-Egypt confirms the success in affirming its position in the Egyptian market, which is one of the main growth markets for NBK Group, given its promising growth opportunities and positive prospects.

The strength of NBK-Egypt’s profits lies primarily from being operationally driven by improved business environment, reflecting the stability of the economic situation in Egypt. He indicated that this stability will create new (investment and financing) opportunities for the bank, which in turn will contribute to improving the level of product integration between the NBK-Egypt and the Group, thus strengthening its position in the Egyptian market.

Al-Sager confirmed that NBK Group's investments in Egypt are of strategic and long-term nature. NBK-Egypt is considered one of the most important branches for the Group due to Egypt’s great economical weight in the region. He also highlighted that NBK-Egypt’s importance to the group continues to grow over time. This is reflected in the continued growth of its profits, which increases its contribution to the Group’s total profits.

He added that we aim to strengthen our position in Egypt as well as increase growth rates in a way that reflects our optimistic outlook in the Egyptian economy. The Egyptian market has various economic fundamentals and a solid foundation. NBK Group continuously strives to offer the best in class service quality in line with its prominent regional and international leadership.

Meanwhile, Dr. Yasser Hasan, Managing Director of NBK-Egypt highlighted the bank’s solid performance across all financial indicators despite the challenging environment across the local and international capital markets, as well as the various changes taking place on the Egyptian economic arena as a result of floating the Egyptian Pound late last year. He also attributed that strong performance to the bank’s conservative strategy as a member of NBK Group.

He added that the Bank's policy is based on maintaining a well diversified and balanced sources of income and loan portfolio, while providing more flexible financing solutions and  innovative banking products tailored to client’s actual needs and based on thorough analysis and market research. This is in addition to the bank's solid financial position, strong balance sheets and successful strategy.

He further stated that most of the bank’s profits are driven by corporate credit services, with a highly diversified portfolio drawing on the diversification of the Egyptian economy itself. He also added that the bank strives to strengthen its position in retail banking as well over the coming period.

He pointed out that the bank currently has 43 branches across various Egyptian governorates and is seeking to bring the number of branches up to 60 within 3 years.

NBK-Egypt (previously known as Al-Watany Bank of Egypt) is a member of NBK Group and was established in 1980. The bank has a network of branches situated at various strategic locations across Egyptian governorates and cities including Cairo, Giza, Alexandria, Delta, Sinai, the Red Sea, and Upper Egypt, as well as industrial areas like Sixth of October, and Tenth of Ramadan. NBK-Egypt is also one of the few banks licensed to offer Islamic banking solutions in addition to the conventional products.

National Bank of Kuwait was incorporated in 1952 as the first local bank and the first shareholding company in Kuwait and the Gulf region. NBK continues to enjoy collectively one of the highest ratings among all banks in the Middle East from the three international rating agencies Moody’s, Fitch Ratings and Standard and Poor’s. The Bank’s ratings are supported by its high capitalization, prudent lending policies, and its disciplined approach to risk management, in addition to its highly recognized and very stable management team. NBK was also named among Global Finance’s list of the 50 safest banks in the world for the eleventh consecutive time and was awarded as the Best Bank in Kuwait in 2016 by the Banker, Euromoney and Global Finance. NBK enjoys the widest banking presence with a local and international network reaching 4 continents. NBK’s international presence spans many of the world’s leading financial centers including the United States of America, Europe, GCC, Middle East, China as well as Singapore.

Egypt: NBK-Egypt reports EGP 4.021 billion (Equivalent to KWD 41.4 million) in net profit in FY2023

National Bank of Kuwait - Egypt (NBK-Egypt) has announced net profits of EGP 4.021 billion (Equivalent to KWD 41.4 million) for the financial year 2023, a significant increase from the EGP 1.826 billion (Equivalent to KWD 30.7 million) reported in 2022, showcasing an impressive annual growth rate of 120.21%.

Net Operating Income stood at EGP 8.66 billion, recording a substantial increase of 87.04% from the EGP 4.63 billion recorded in 2022. In the meantime, Net Interest Income jumped by 82.51%, reaching EGP 6.99 billion compared to EGP 3.83 billion in 2022.

On the other hand, Net Operating Income (excluding interests) increased to EGP 1.67 billion in 2023, compared to EGP 0.8 billion in 2022, up by 108.75%, while Cost to Net Operating Income dropped from 37.14% in 2022 to 28.02% in 2023.

Total assets reached EGP 130.61 billion in 2023, up by 24.22% compared to the year-end balance of EGP 105.14 billion in 2022. Furthermore, the net balance of loans and credit facilities expanded to EGP 76.06 billion 2023, reflecting a growth rate of 38.42% compared to EGP 54.95 billion recorded at the end of 2022. Moreover, customer deposits continued to grow, rising by 25.42% to reach EGP 105.93 billion in 2023, compared to EGP 84.46 billion by the end of 2022.

The Return on Average Assets (ROAA) surged from 2% at the end of 2022 to 3.4% at the end of 2023, while the Return on Average Equity (ROAE) increased from 16.9% at the end of 2022 to 30.7% by the end of 2023.

Commenting on the financial results announced by NBK-Egypt, Ms. Shaikha Al-Bahar, Deputy Group Chief Executive Officer, National Bank of Kuwait, and Chairman of NBK-Egypt, said: “In 2023, NBK- Egypt achieved its highest annual profits to date, accompanied by record growth rates. This success is credited to a strong operational performance, highlighting the resilience of our financial position and the flexibility of our business model, which allows for profit generation despite operational challenges.

“At NBK - Egypt, our objective is to enhance banking transactions and elevate their quality to meet growing market demand. We pursue this goal by focusing on the advancement of our digital services, leveraging the expertise and excellence of the Group in this domain. Additionally, we aim to expand our loan portfolio for SMEs, broaden the scope of our operations, and diversify them to encompass a wider geographical reach and cater to various customer segments,” Al-Bahar added.

Al-Bahar emphasized that Egypt stands as one of the key strategic markets for fostering the Group's business growth, consistently regarded as the second domestic market. Being the largest Kuwaiti investment in Egypt, the bank holds a significant presence in the Egyptian banking sector, evident in its rapid growth trajectory and strong financial performance. The Bank's positive momentum underscores its commitment to expanding further and strengthening its market position.

Al-Bahar also highlighted that the Group perceives the Egyptian market as a strategic long-term investment. Given that the Egyptian economy ranks among the largest in the region, it holds substantial growth potential once it regains momentum.

She further emphasized that Egypt represents a significant growth market, and that the Bank is committed to its continuous expansion. The operations in Egypt continue to be among the most profitable within the Group, boasting the highest rates of return on shareholders' equity and assets.

“As geopolitical tensions in the region subside, economic recovery efforts will receive a significant boost. By restoring confidence in the economy and currency, substantial opportunities will emerge. We maintain an optimistic outlook on future prospects, buoyed by the momentum generated from the Egyptian government and the Central Bank of Egypt's reform and exceptional measures,” Al-Bahar confirmed.

Meanwhile, Vice Chairman, CEO, and Managing Director of National Bank of Kuwait-Egypt, Mr. Yasser El-Tayeb, said: “The robust financial results and key indicators serve as the most compelling evidence, showcasing the Bank's capacity to maintain growth and attain favorable business outcomes throughout 2023, notwithstanding the unprecedented challenges faced both locally and globally. These challenges include the aftermath of the Russian-Ukrainian conflict, the Gaza war, import crises, and fluctuations in the foreign exchange rate against the Egyptian pound”.

El-Tayeb emphasized that NBK-Egypt maintains a well-balanced distribution of revenues across diverse business activities. This strategic approach is coupled with efficient operational rates and risk ratios, aligning with the dual objectives of achieving growth and ensuring business sustainability. Credit for this success is attributed to the Bank's prudent policies and a sound business model, demonstrating its capability to meet customer needs.

El-Tayeb further explained that the majority of NBK's income sources in Egypt are derived from credit operations in both the corporate sector and the rapidly expanding retail banking sector. The latter has notably increased in prominence, particularly in recent years, with a very diversified credit portfolio including a wide range of businesses across various sectors ranging from large scale corporations to SMEs. Meanwhile, the retail banking portfolio is also well diversified. This solid position reflects the Bank’s strength and the diversity of its revenue streams. He also highlighted that going forward, NBK-Egypt strives to further strengthen its position in retail banking by offering innovative services and products to its retail customers, in addition to continuing the horizontal growth plan by inaugurating new branches covering key locations throughout the Egyptian market.

Al-Tayeb also emphasized the Bank's firm belief in the pivotal role of technological advancements and electronic channels within the banking sector. Recognizing their significance in bolstering competitive advantages among banks, we, at NBK-Egypt have prioritized a robust expansion of our electronic banking services, making substantial investments in this area. Our ultimate goal is to provide customers with an exceptional banking experience, offering a unique facility that enables them to conduct the majority of their banking transactions conveniently, anywhere, anytime. Furthermore, we aim to encourage customers to utilize electronic means and channels for payments, aligning with the broader policy objectives of the state and the Central Bank of Egypt in this regard.

Furthermore, El-Tayeb highlighted NBK-Egypt's commitment to align its strategies with the global movement towards sustainable finance and the transition to a green economy. The Bank aims to actively support environmentally friendly projects that promote sustainability and the utilization of renewable energy sources to mitigate climate change, since sustainable financing has emerged as a fundamental mechanism and instrument for facilitating and maintaining enduring financial stability.

In terms of the bank's social responsibility, Al-Tayeb highlighted that since NBK Group entered the Egyptian market in 2007, NBK-Egypt has remained dedicated to serving the Egyptian community. This commitment is demonstrated through the support, donations, and contributions extended to numerous charitable organizations. Additionally, the Bank actively collaborates with reputable civil society institutions, establishing partnerships aimed at becoming the operational arm of the Bank's development initiatives.