14 April 2020
Al Ahli Bank of Kuwait (ABK), held its Annual General Meeting (AGM) on Tuesday 14th April, at 10:00 am, with a quorum of 84.4%, to discuss the Bank’s performance and AGM agenda, subsequent to releasing its financial results for the year ended 31st December, 2019.
For the Annual General meeting, ABK took a number of precautionary measures in line with the guidance of the Ministry of Health, aimed at protecting the health of attendees and shareholders, as these measures are of utmost importance during the ongoing Coronavirus pandemic.
Mr. Talal Mohamed Reza Behbehani, Chairman of ABK, opened the Annual General Meeting by welcoming the attendees and thanked them for their attendance despite the difficult circumstances the country is going through due to the Coronavirus Pandemic. He presented the Directors’ Report for the financial year 2019, noting that overall the Bank continued to perform well with its Operating Income levels increasing. The reduction in Net Profit witnessed in 2019 was the result of a very conservative provisioning policy, which was applied on fully secured but non-performing legacy credits. The Group’s asset quality remains very robust, with the NPL ratio at 1.46% and NPL provision coverage of 365%. The Capital Adequacy Ratio is a healthy 18.6%, comfortably exceeding the regulatory ratio, with Shareholders’ Equity at KD 599 Million.
ABK Group continued to maintain its strong ratings of A+ (stable) and A2 (stable) from International rating agencies Fitch and Moody’s, making ABK the second best rated conventional bank in Kuwait, reflecting its strong capital position, resilient earnings capacity, stable funding and liquidity sources.
Domestic operations remain very much central to ABK’s success, with more than 75% of its total assets based in Kuwait, partially insulating the Bank from external geopolitical risks.
ABK’s International operations contributed 30% of the Group’s Operating Income. ABK- Egypt had another very successful year with Operating Income up 40% and Net Profit increasing 52%, while ABK’s UAE operations also performed well with an increase in both Operating Income and Net Profit. ABK’s DIFC branch has been extremely successful since opening in 2018 and continues to provide vital services to customers, offering a convenient offshore booking office for local and regional corporates, regional loan syndications, and large project finance transactions.
ABK’s Structured Finance Division was actively engaged in government projects in areas such as power, waste and infrastructure, as part of Kuwait’s 2035 plan. ABK recently signed on behalf of a consortium of banks, the PPP agreement for the Umm Hayman Waste Water Project for USD 650 Million. ABK was also the Initial Mandated Lead Arranger for ALAFCO’s USD 600 Million syndicated loan.
Mr. Behbehani stated that despite the current challenges everyone is facing with Coronavirus, the Bank will continue implementing its ‘Simplify & Transform’ strategy, with the aim of delivering new customer experiences, digital transformation and operational efficiency. In order to meet the ever-evolving needs of increasingly “tech-savvy” customers, ABK launched a range of digital initiatives, some of which were first to the market, designed to make accessing banking services simpler, easier and more convenient. The Bank also launched the Tasdeed service for Point-Of-Sale (POS) and e-Com Online Payment Gateway transactions related to the Kuwait ministries and government authorities during the year.
During 2019, ABK embarked on a range of Corporate Social Responsibility (CSR) initiatives, as part of the Group’s commitment to make a difference in the communities it operates in. These efforts were strongly supported by ABK staff, who actively engaged in volunteer programs. Through CSR initiatives, ABK advocates inclusive, social and sustainable development and the creation of a more equitable society. More details can be found in the CSR booklet accompanying the Annual Report and on ABK’s website, eahli.com.
The Bank will continue to invest heavily in local talent development through training and recruitment initiatives, and will look to offer further opportunities for Kuwait’s youth to develop successful careers in the banking sector.
The General Assembly then moved on to discuss the agenda, and approved all agenda items. The most important items were as follows:
- Approval of the Directors’ Report on ABK financial year ended 31st December 2019 and approval of the External Auditors’ Report on ABK for the financial year ended 31st December 2019.
- Approval of ABK Financials inclusive of its Balance Sheet and Profit & Loss Account for the financial year ended 31st December 2019.
- Approval to stop the deduction for the compulsory reserve account for the financial year ending December 31, 2020 which stood at KD 81,010 thousand, with the addition of KD 1,512 thousand from the profits of the financial year ended 2019. The amount in the compulsory reserve account as at 31st December 2019 is more than half of the Bank’s issued and paid up capital of KD 161,917 thousand.
- Approval of the recommendation of the Board of Directors to distribute cash dividends for the financial year ended 31/12/2019 at the rate of 7% (seven percent) of the nominal value per share (i.e. seven fils per share), to the shareholders registered in the Bank’s shareholders’ records as at the close of business on Monday 4/5/2020.
The cash dividends shall be distributed to the entitled shareholders, as of Sunday 10/5/2020.
- Approval to authorize the Board of Directors to buy, sell, or dispose of no more than 10% (ten percent) of the Bank’s own shares, according to the controls and conditions stipulated by the law, decisions, regulations, and instructions of the regulatory authorities in this regard, and that this mandate continues to apply for a period of eighteen months from the date of this Annual General Meeting.
- Approval to authorize the Board of Directors to issue bonds of all kinds in Kuwaiti Dinars or any other currency it deems appropriate inside and / or outside the State of Kuwait and determining the terms and conditions of these bonds. The Board of Directors may seek the assistance of those it deems necessary to issue bonds after obtaining the approval of the regulatory authorities.
- Approval to deal with subsidiaries, associates and other related parties during the financial year 2020.
- Approval to grant loans and advances and to provide guarantees and other credit facilities to its client during the financial year 2020, in accordance with the regulations and conditions that the Bank applies to third parties.
For more information about ABK please visit eahli.com or contact an ABK customer service agent via ‘Ahlan Ahli’ at 1899899.