BAHRAIN • KUWAIT • OMAN • EGYPT • IRAQ • LIBYA • UNITED KINGDOM Contents
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BAHRAIN • KUWAIT • OMAN • EGYPT • IRAQ • LIBYA • UNITED KINGDOM Contents 02 Group mission statement 26 Corporate governance 03 AUB operating divisions 33 Group business and risk review 06 Financial highlights 38 Group organisation 14 Board of Directors’ report 39 Group management 18 Board of Directors 40 Contact details 20 Chairman’s statement 41 Consolidated financial statements 22 Group Chief Executive Officer & 90 Pillar III disclosures - Basel II Managing Director’s statement With AUB on a more solid and assured footing, it is now moving forward in capitalizing on its strengths and targeting opportunities for growth and expansion across its business lines and geographies. 02 Ahli United Bank Annual Report GROUP MISSION 2013 STATEMENT To create an unrivalled ability to meet customer needs, provide fulfillment and development for our staff and deliver outstanding shareholder value. Objectives AUB Vision & Strategy • to maximize shareholder value on a • Develop an integrated pan regional sustainable basis. financial services group model centered • to maintain the highest international on commercial & retail banking, private standards of corporate governance banking, asset management and life and regulatory compliance. insurance with an enhanced Shari’a compliant business contribution. • to maintain solid capital adequacy and liquidity ratios. • Acquire banks and related regulated financial institutions in the Gulf countries • to entrench a disciplined risk and cost (core markets) with minimum targeted management culture. 10% market share to be achieved • to develop a cross-cultural meritocratic through mergers, acquisitions and management structure. organic growth. • to optimise staff development through • Acquire complementary banking business driven training and profit platforms in secondary markets related incentive. enjoying strong cross border business • to contribute to the social and economic flows with Gulf countries or with advancement of the communities in economic structures similar to the Gulf which the Group operates. countries. 03 Ahli United Bank Annual Report OPERATING 2013 DIVISIONS Corporate Banking, Treasury & Retail Banking Investments This division covers both conventional This division covers all the Bank’s capital- and Shari’a Compliant individual intensive activities in risk asset generation customers’ deposits, loans, overdrafts, and funding regionally and internationally. credit cards and residential mortgages. • Corporate and Trade Finance Risk Management • Treasury • Commercial Property Finance This division is responsible for the • Residential Property Finance identification, assessment and ongoing • Acquisition and Structured Finance control of all material risks that could affect the Group’s business & operations. • Correspondent Banking • Shari’a Compliant Banking • Risk Management • Legal Private Banking & Wealth Management • Compliance Audit This division generally includes all the low capital-intensive sectors of the business, This division is an integral part of the offering wealth management services control environment of the Group. The to individuals and institutions based on role of audit is to understand the key performance and a balanced product risks of the Bank and examine and mix. evaluate the adequacy and effectiveness • Private Banking and Asset Management of the system of risk management and internal control in order to identify legal, • Real Estate Fund Management regulatory or policy shortcomings. • Shari’a Compliant Banking Support Services These divisions provide back end banking services to support on-going business activities of the Group, as well as supporting the Group’s expansion through mergers and acquisitions. • Finance • Strategic Development • Information Technology • Operations • Services • Human Resources 04 Ahli United Bank Annual Report 2013 Ahli Bank Oman UBCI 35.0% Libya AUB Bahrain 40.0% 100% CBIQ Iraq 71.3% 7 Subsidiary & AUB Associate United Kingdom Banks 100% AUB Kuwait 74.9% AUB Egypt 85.4% 7 Countries US$ 579.4m 128 Net Profit Branches US$ 3,148.8m Shareholders’ Equity 3300 US$ 32.7billion Committed employees Total Assets 05 Ahli United Bank Annual Report 2013 MOVING FORWARD... FOR YOU AUB has made a name for itself in being the trusted and truly dependable bank for its customers and counterparties, making good on its commitments in all circumstances and meeting their needs in good and adverse times. 06 Ahli United Bank Annual Report FINANCIAL 2013 HIGHLIGHTS Net Profit US$ ‘000s Total Assets US$ ‘000s 579,374 32,651,893 2013 2013 2012 2011 2010 579,374 2009 2012 32,651,893 2011 29,872,574 28,329,762 2010 26,457,461 2009 23,573,983 335,703 310,610 265,499 200,718 Total Loans US$ ‘000s Shareholders’ Equity US$ ‘000s 17,305,682 3,148,824 2013 2013 2012 2011 2012 2010 2011 2009 2010 2009 3,148,824 17,305,682 15,972,219 2,776,209 15,495,961 14,477,713 2,537,431 2,392,181 13,299,999 2,213,523 07 Ahli United Bank Annual Report CONSOLIDATED 2013 PERFORMANCE SUMMARY Ahli United Bank B.S.C. US $ ‘000s Dec 13 Dec 12 Dec 11 Dec 10 Dec 09 Net profit* 579,374 335,703 310,610 265,499 200,718 Total assets 32,651,893 29,872,574 28,329,762 26,457,461 23,573,983 Total loans 17,305,682 15,972,219 15,495,961 14,477,713 13,299,999 Total liabilities 29,086,790 26,711,067 25,418,621 23,705,286 20,992,552 Shareholders’ equity 3,148,824 2,776,209 2,537,431 2,392,181 2,213,523 Non-controlling interest 416,279 385,298 373,710 359,994 367,908 Return on average assets ( ROAA) 1.3% 1.3% 1.2% 1.2% 0.9% Return on average equity (ROAE) 13.4% 13.0% 12.7% 12.0% 9.6% Cost to income ratio 30.0% 31.5% 32.4% 33.6% 31.5% Financial leverage 8.2 8.4 8.7 8.6 8.1 Risk asset ratio** 16.2% 15.6% 16.0% 14.1% 15.1% Net interest margin 2.32% 2.20% 2.10% 2.30% 2.36% Earning per share (US cents) - basic 10.5 6.1 5.6 4.9 3.8 Earning per share (US cents) - diluted 10.4 6.0 5.5 4.9 3.8 (2013 Total ROAE including gain related to the divested ABQ stake was 20.1%) (2013 Total ROAA including gain related to the divested ABQ stake was 2.0%) Net profits 2013 US$ 579.4m Net profits 2012 US$ 335.7m * Attributable to Bank’s equity shareholders ** Under BASEL II 08 Ahli United Bank Annual Report PRINCIPAL 2013 SUBSIDIARIES Kuwait: Ahli United Bank K.S.C.P. KD’ 000s Dec 13 Dec 12 Dec 11 Dec 10 Dec 09 Net profit* 42,459 38,539 31,544 27,444 14,262 Total assets 3,164,976 2,632,922 2,627,839 2,454,337 2,260,533 Total loans (financing receivables) 2,140,922 1,728,082 1,617,722 1,609,986 1,561,104 Total liabilities 2,841,821 2,337,541 2,352,808 2,189,041 2,023,197 Shareholders’ equity 309,792 282,809 262,190 245,679 213,159 Non-controlling interest 13,363 12,572 12,841 19,616 24,177 Return on average assets 1.5% 1.4% 1.3% 1.1% 0.6% Return on average equity 14.9% 14.5% 12.7% 12.2% 6.2% Cost to income ratio 30.9% 34.2% 39.7% 38.7% 33.4% Financial leverage 8.8 7.9 8.6 8.3 8.5 Risk asset ratio ** 19.2% 19.7% 21.3% 18.8% 16.8% Earning per share (fils) 36.2 32.9 26.9 23.4 12.2 Net profits 2013 KD 42.5m Net profits 2012 KD 38.5m * Attributable to Bank’s equity shareholders ** Under BASEL II 09 Ahli United Bank Annual Report 2013 Kuwait: Kuwait and Middle East Financial Investment Company K.S.C.P. KD’ 000s Dec 13 Dec 12 Dec 11 Dec 10 Dec 09 Net profit (loss) * 1,161 (1,165) (11,839) (8,912) (9,443) Total assets 53,520 52,226 53,534 64,895 86,236 Total loans 8,293 8,559 8,854 9,391 14,418 Total liabilities 28,197 28,220 29,364 27,343 39,607 Shareholders’ equity 23,488 22,029 22,576 35,742 44,797 Return on average assets 2.2% (2.2%) (18.7%) (12.7%) (10.1%) Return on average equity 5.0% (5.1%) (34.9%) (20.5%) (18.0%) Cost to income ratio 77.4% 141.3% 181.4% 186.7% 114.7% Earnings (Loss) per share (fils) 4.4 (4.5) (45.3) (34.1) (36.2) Net profits 2013 KD 1.2m Net loss 2012 KD 1.2m * Attributable to Company’s equity shareholders 10 Ahli United Bank Annual Report PRINCIPAL 2013 SUBSIDIARIES CONTINUED United Kingdom: Ahli United Bank (UK) PLC US $ ‘000s Dec 13 Dec 12 Dec 11 Dec 10 Dec 09 Net profit 41,216 36,376 36,380 20,760 7,164 Total assets 4,151,944 3,434,061 3,419,561 2,718,253 2,030,367 Total loans 1,597,323 1,609,390 1,767,372 1,560,955 1,309,903 Total liabilities 3,854,676 3,174,424 3,158,780 2,478,638 1,813,063 Shareholders’ equity 297,268 259,637 260,781 239,615 217,304 Return on average assets 1.1% 1.0% 1.2% 0.9% 0.3% Return on average equity 14.8% 13.5% 14.5% 9.1% 3.4% Cost to income ratio 40.3% 35.6% 30.4% 38.1% 41.3% Financial leverage 13.0 12.2 12.1 10.3 8.3 Risk asset ratio* 17.5% 18.9% 17.5% 15.3% 16.5% Earning per share (US cents) 20.6 18.1 18.2 10.4 3.6 Net profits 2013 US$ 41.2m Net profits 2012 US$ 36.4m * Under BASEL II 11 Ahli United Bank Annual Report 2013 Iraq: Commercial Bank of Iraq P.S.C.