Preliminary Results for second quarter of 2013

BankMuscat announces preliminary results for the second quarter of 2013

Net Profit at RO 63.1 million 

MUSCAT, 15th July, 2013: Bank Muscat, the flagship financial institution in the Sultanate, announced its preliminary results for the first half of 2013. The Bank posted a net profit of RO 63.1 million for the period, compared to RO 68.4 million reported during the same period in 2012. An exceptional operating loss provision of RO 15 million relating to the Prepaid Travel Card fraud incident (as disclosed to the market on February 25, 2013 and February 26, 2013) was considered in Q1 2013 in accordance with the IFRS. The Bank is working on various channels to recover the loss arising from this exposure and will update the market on any material developments in this regard.

The Bank's key business lines continued to perform well and in line with expectation and market potential. The bank's Islamic Banking window "Meethaq" financial results are consolidated in the financial statements for the purpose of consolidated financial reporting with appropriate disclosures.

The key highlights of the results for the period are as follows:

1) Net interest income for conventional banking stood at RO 109.2 million for the first six months of 2013 compared to RO 108.9 million for the same period in 2012. The Net Interest income remained flat during the period due to compression in the Net Interest Margins.

2) Net Income from Islamic Financing for the first half in 2013 stood at RO. 4.8 million.

3) Other Operating Income at RO 51.7 million is 13% higher than RO 45.8 million of first half of 2012.

4) Operating expenses for the first half of 2013 at RO 87.4 million (including prepaid travel card operating loss provision) as compared to RO 66.3 for the same period in 2012. Excluding the operating loss provision as stated above, bank's operating expenses would have increased by 9% as compared to the first half in 2012.

5) Impairment for credit losses for the first half period in 2013 was RO 17.5 million as against RO 25.1 million for the same period in 2012.

6) Net Loans and advances increased by 7% per cent to RO 5,567 million as against RO 5,181 million as at June 30th, 2012. Customer deposits, including CDs, increased by 13 per cent to RO 5,718 million as against RO 5,039 million as at June 30th, 2012.

7) Islamic financing receivables amounted to RO 215 million during the first half and Islamic Banking customer deposits amounted to RO 133 million.

The full results of the first quarter period ended June, 2013 along with the complete set of financial statements will be released after the approval from the Board of Directors at its meeting scheduled later during July 2013.

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