DELIVERING
Annual Report 2005
MORE & MORE
Contents
Design and Production: Miracle Graphics
03
Profile, Vision and Mission
04
Financial Summary
05
Financial Highlights
06
Board of Directors
07
Chairman’s Statement
10
Executive Management
11
Executive Management Report
16
Shari’a Supervisory Board
17
Shari’a Supervisory Board’s Report
18
Auditor’s Report
19-43
Consolidated Financial Statements
44
Contacts and Information
His Highness Shaikh Khalifa
bin Salman Al Khalifa
His Majesty King Hamad
bin Isa Al Khalifa
His Highness Shaikh Salman
bin Hamad Al Khalifa
The Prime Minister
The King of Bahrain
The Crown Prince &
Commander in Chief of the
Bahrain Defence Force
02
Bahrain Islamic Bank
Annual report 2005
In the name of Allah,
most Gracious, most Merciful
03
Bahrain Islamic Bank
Annual report 2005
PROFILE
Established in the Kingdom of Bahrain as the first Islamic commercial bank, Bahrain Islamic Bank has grown
steadily since 1979 to become a leading Islamic institution with shareholders’ funds of approximately BD 72 million
and total assets in excess of BD 321 million at year-end 2005.
The Bank has established leadership in the application of Islamic modes of investment and financing and excelled
in the provision of a diversified range of products and services for retail customers, commercial businesses and
financial institutions.
Publicly listed on the Bahrain Stock Exchange, the Bank is owned largely by prominent local and regional financial
institutions and is regulated by the Bahrain Monetary Agency.
With a strong and growing network of branches, currently numbered at 12, the Bank is well positioned to meet
strong and growing demand in the market for banking, financing and investment opportunities on behalf of
individuals and institutions with the highest ethical standards and an unwavering commitment to the principles of
Islamic Shari’a.
Vision
Mission
To be a leading and diversified domestic
and regional Islamic financial institution
that drives innovation in the industry and
effectively meets the fast evolving needs
of the markets we serve.
To provide value and superior returns to
shareholders, investors and customers through
the continuous development of our assets and
resources including the introduction of valueadded retail, investment and corporate
banking products and the achievement of the
highest levels of service and customer
satisfaction.
04
Bahrain Islamic Bank
Annual report 2005
Financial Summary
Net Income Summary
(in BD millions)
2005
2004
2003
2002
Total operating income
Investors’ share in income
Bank’s share in income
Expenses and other charges
17.7
5.1
12.6
5.2
10.8
2.1
8.7
5.0
8.9
1.6
7.3
4.9
7.9
2.1
5.8
3.7
7.4
3.7
2.5
2.1
2005
2004
2003
2002
Investments
Sukook and other assets
105
75
85
57
111
52
43
48
97
51
39
45
104
36
43
27
Total Assets
321
255
231
210
Current accounts
Investment by non banks
Banks and other liabilities
Total liabilities
Shareholders' equity
47
142
60
249
72
30
129
43
202
53
29
122
41
191
40
21
122
29
172
38
Total liabilities and equity
321
255
231
210
Net income for the year
Balance Sheet Summary
(in BD millions)
Short term murabaha
Murabaha receivables
Composition of Net Income
(BD million)
5.2
17.7
5.1
7.4
5.0
4.9
3.7
10.8
3.7
2.1
2.1
1.6
8.9
2.5
7.9
02
2.1
03
04
Operating Income
05
02
03
04
05
Operating Expenses
02
03
04
05
Investor’s Share of Profit
02
03
Net Income
04
05
05
Bahrain Islamic Bank
Annual report 2005
Financial Highlights
2005
2004
2003
2002
Net Income (BD millions)
7.4
3.7
2.5
2.1
Total Assets (BD millions)
321
255
231
210
Total Equity (BD millions)
72
53
40
38
Return on average equity (%)
12.0%
7.9%
6.2%
5.4%
Return on average assets (%)
2.5%
1.5%
1.1%
1.0%
284
229
174
166
30
15
11
9
Book value per share (Fils)
Earnings per share (Fils)
522
354
270
175
Distribution - cash dividend
Share price (Fils)
15%
12%
10%
10%
bonus shares
12%
10%
-
-
Composition of Assets
(BD million)
321
85
75
72
255
53
231
51
52
40
210
38
43
43
39
36
02
03
04
05
Murabaha Receivables
02
03
Investments
04
05
02
03
Total Assets
04
05
02
03
Total Equity
04
05
06
Bahrain Islamic Bank
Annual report 2005
The Board of Directors
Khalid Abdulla Al Bassam
Aref Ahmed Al Koheeji
Sami Bader Al Jana’i
Chairman
Member*
Member •
Hisham A. Rahman Al Khalifa
Yousif Mohd Al Awadhi
Dr. Ahmed Aqeel Aljanahi
Vice Chairman & Chairman of
Audit Committee**
Member*
Member • *
Khalid Mohamed Najibi
Ali Mohamed Al Olimi
Mohd A. Latif Buqais
Member & Chairman of
Executive Committee*
Member**
Member • *
*
Member of the Executive Committee
Khalid Mohd Habib
**
Member of the Audit Committee
Member**
•
Member until 6 October 2005
Khalid Abdulla Al Bassam
07
Bahrain Islamic Bank
Annual report 2005
Chairman’s Statement
Bahrain Islamic Bank achieved very strong
earnings during 2005, with net profits
increasing by 100 per cent to a record
BD 7.4 million compared to BD 3.7 million
the previous year. There was also a strong
growth in assets, which rose by 26 per
cent to BD 321 million, and showed an
improvement in both quality and return.
This increase was due mainly to the Bank’s
financing transactions in general, as well
as the excellent returns from real estate
investment activities.
IN THE NAME OF ALLAH, MOST
GRACIOUS, MOST MERCIFUL,
PEACE AND BLESSINGS BE UPON
HIS MESSENGER.
Dear valued shareholders,
On behalf of the Board of Directors, it is
my privilege to present the 2005 annual report
for Bahrain Islamic Bank. This proved to be a
very successful year for the Bank, highlighted
by significantly improved performance across
all areas of operations, and notably enhanced
value for our shareholders. I am delighted to
report that the record achievements during
2005 exceeded our expectations and that we
were able to deliver even more than we
promised last year. Also during 2005, the Bank
successfully strengthened its infrastructure and
laid solid foundations for future growth.
In line with our commitment to deliver
superior returns to our shareholders, I am
pleased to report that shareholders’ equity
rose by 36 per cent to BD 72 million at the
end of the year, reinforced by significant
unrealised gains on the revaluation of
certain corporate investments. Equally
pleasing was the performance of the Bank’s
share price during 2005, which reached a
12-month high of BD 0.710, and closed
Share Price (fils)
522
05
354
04
270
03
175
02
0
100
200
300
400
500
at BD 0.522, compared to BD 0.354 at the
end of 2004.
As a result of the Bank’s excellent financial
results, the Board of Directors has
recommended the payment of a total
dividend to shareholders of 27 per cent
of paid-up capital, compared to 22 per cent
in 2004. This will take the form of a cash
dividend of 15 per cent (2004: 12 per cent)
and the issue of 12 bonus shares for
every 100 shares held (2004: 10 per cent
bonus shares).
I would also like to report a change to our
shareholding structure during the latter
quarter of 2005. This resulted from the sale
of a 26 per cent stake in the Bank by a
strategic investor to Almadar Finance &
Investment Company, which is a subsidiary of
The Investment Dar, a successful and active
player in the investment, consumer finance
and real estate sectors in Kuwait.
08
Bahrain Islamic Bank
Annual report 2005
Chairman’s Statement continued
The performance of the Bank during 2005
took place against a backdrop of robust
economic growth throughout the GCC region,
fuelled by higher oil prices and increased levels
of liquidity. This helped to boost public
spending on major infrastructure and industrial
projects, with regional governments and public
sector entities increasingly tapping financial
markets for their funding requirements,
including the use of Islamic instruments. At
the same time, there was increased investment
by the private sector – both domestic and
foreign – in the region’s stock markets and real
estate, tourism, services and industrial sectors.
These developments had a positive impact on
the regional financial services sector during
2005, with stock markets posting record gains,
and banks and other institutions reporting
high levels of business activity and profitability.
The Islamic banking sector continued its strong
growth rate in recent years, with continued
improvements in transparency, product
innovation and customer focus resulting in
improved investor confidence.
human resources and information technology;
developing new innovative products; and
enhancing customer service.
The year was also marked by intensified levels
of competition, with the entry of further new
players, and more aggressive marketing
activities by existing players. In addition, there
were new challenges posed by a changing
regulatory environment, including local
restrictions on consumer credit loans and
revised international Basel II requirements.
In support of this new strategic approach,
and to take advantages of the attractive
opportunities in the local and regional
markets, we finalised plans during the year to
enable the Bank to play a more active role in
the fast-growing real estate sector, through its
wholly-owned real estate subsidiary company.
Throughout 2005, we continued to strengthen
the Bank’s organisational capability in order to
support our strategic objectives and enhance
our competitive edge. This included further
streamlining of the Bank’s internal operating
processes, recruiting additional qualified
professionals for key areas, and signing a
contract for a new core banking system to be
implemented during 2006. In addition, we
launched a new Shari’a-compliant home
finance product that provides customers with
During 2005, the Board of Directors approved a
new three-year strategic plan for 2006 to 2008.
This is designed to support the Bank’s ability to
respond to changing market conditions and
ensure continued growth and sustainable
profitability. Key strategic objectives include
delivering superior returns to shareholders;
positioning the Bank for future growth, both
domestically and regionally; increasing our focus
on the real estate sector; continuing to invest in
Return on Average Equity (%)
05
12
7.9
04
6.2
03
5.4
02
0
2
4
6
8
10
12
09
Bahrain Islamic Bank
mortgage financing of up to BD 200,000 with
a repayment period extending to 20 years, at
very competitive financing.
The Bank is committed to upholding the highest
standards of transparency, disclosure and
compliance. Accordingly, in 2005, we began
implementing the latest guidelines from the
Bahrain Monetary Agency on high level banking
controls and policies, and the notification
requirements relating to corporate governance
responsibilities of directors and executive
management. We also progressed preparations
to ensure the Bank’s readiness for the
implementation of new Basel II requirements. In
addition, we commissioned external consultants
to assist us in enhancing our key policies for
investments, credit and human resources, as well
as conducting an overall assessment of our
Bank-wide risks.
As an Islamic financial institution, we have
always taken our corporate social responsibility
Annual report 2005
very seriously, and remain committed to
supporting the local community in which we
operate. In 2005, we increased the amount
of our charitable donations and Zakat budget,
and made a substantial financial contribution
to the newly-established Islamic Financial
Centre for Research in Bahrain.
Statutory elections for the Board of Directors
took place in March 2005, and I would like to
take this opportunity to express my gratitude
to the eight retiring members, whose hard
work and diligence made such a valuable
contribution to the success of the Bank
during their tenure. I would also like to
welcome the new incoming members, with
the certainty that they will serve the Bank
with all due diligence and distinction.
In conclusion, I would like to express my
appreciation on behalf of the Directors, to
the leadership and ministries of the
Kingdom of Bahrain, and to Bahrain
”Bahrain Islamic Bank achieved very strong earnings
during 2005, with net profits increasing by 100 per cent
to a record BD 7.4 million compared to BD 3.7 million
the previous year. There was also a strong growth in
assets, which rose by 26 per cent to BD 321 million, and
showed an improvement in both quality and return.“
Monetary Agency, for their continued
support for the Bank as well as for the
Islamic banking sector in Bahrain.
I would also like to thank the members of
our Shari’a Supervisory Board for their
invaluable contributions, guidance and
direction; our shareholders, investors and
customers for their loyalty and trust; and our
management and staff for their hard work
and dedication.
Together, they have contributed to yet
another successful year for Bahrain Islamic
Bank, and continue to inspire us with
renewed strength to effectively meet the
opportunities and challenges of the future.
Allah the Almighty is the Purveyor of all
Success.
Khalid Abdulla Al Bassam
Chairman
10
Bahrain Islamic Bank
Annual report 2005
Executive Management
Yousif Saleh Khalaf
Khalid Al Dossari
Ahmed Al-Saigal
Mohsin Alkhan
Chief Executive Officer
Senior Manager
Financial Control
First Manager
Corporate Banking
First Manager
Local Branches
Khalifa Najim
A. Aziz Al Ruwaihi
Nasreen Al-Qaseer
Senior Manager
Institutional Banking
First Manager
Priority Banking & Sales
First Manager
Credit Administration
Director
Corporate &
Institutional Banking
Hood Hashim
Hala Mufeez
Saleh Al Mehri
Senior Manager
Information Division
First Manager
Risk Management
First Manager
Internal Audit
A. Rahman Shehab
Rashid Alolaiwi
Hamad Janahi
Tawfiq Al-Sari
Director
Central Operations
Senior Manager
Retail Banking
First Manager
Investment Department
First Manager
Financial Control
A. Hameed Bucheeri
Salman Aljumairi
Mohd Alkhaja
A. Nasser Al-Mahmood
Senior Manager
Human Resources and Services
Senior Manager
Commercial Banking
First Manager
Central Operations
Manager
Internal Sharia'a Supervision
A. Razaq A. Khalik
Tariq Bucheeri
Mohd Elgioshy
Khalid AlKhayat
Senior Manager
Central Operations
Senior Manager
Retail Services Development
First Manager
Treasury
Manager
Corporate Communications
Dr. Salahudin Saeed
Director
Credit & Risk Management
Faisal Al-Showaikh
Ashraf Shokry
Ramadhan Ali
Senior Manager
Technology Division
Secretary to the Board
Yousif Saleh Khalaf
11
Bahrain Islamic Bank
Annual report 2005
Executive Management Report
IN THE NAME OF ALLAH, MOST
GRACIOUS, MOST MERCIFUL.
PEACE AND BLESSINGS BE UPON
HIS MESSENGER.
Business overview
During 2005, we continued to focus on
enhancing the Bank’s institutional
capability in order to be able to deliver
greater value to our shareholders and
customers. A number of key initiatives
were implemented, covering areas such
as business development, risk
management, information technology,
systems and processes, and human
resources.
Together with the Bank’s strengthened
financial position at the end of 2005,
these solid foundations for growth
and development provide a strong base
from which we can pursue our new
strategic objectives, and continue to
develop the business.The Bank’s
impressive financial and organisational
achievements during they year meant that
we were able to deliver even more value
to our various stakeholders than we
promised on 2004.
Financial performance
For the year 2005, Bahrain Islamic Bank
recorded a net income of BD 7.4 million
representing an increase of 100 percent
as compared to BD 3.7 million posted in
2004. These enhanced results are
attributable to an increase of 64 per cent
in total operating income, which grew
from BD 10.8 million in 2004 to BD 17.7
million in 2005.
Total Assets (BD million)
321
05
255
04
231
03
210
02
0
50
100
150
200
250
300
This rise in total income contributed to an
increase in the Bank's share of operating
income, which improved by 43 per cent to
BD 12.6 million for 2005. At the same
time, the return on investment accounts
increased by 138 per cent to BD 5 million
from BD 2.1 million in 2004.
Total operating expenses increased by
10 per cent for the year as a result of the
Bank’s restructuring activities, and
investments made in new technologies
and human resources. In 2005, costs
related to staffing and related
expenditures rose by 15 per cent whilst
those resulting from general operating
costs decreased by 2 per cent.
The capital base of the Bank was also
reinforced during the year by significant
unrealised gains on the revaluation of
12
Bahrain Islamic Bank
Annual report 2005
Executive Management Report continued
certain quoted corporate investments,
which resulted in shareholders' equity
increasing by 36 per cent to BD 72 million
for the year as well as continued strength
in the Bank’s capital adequacy ratios.
Furthermore, total assets of the Bank
rose by 26 per cent during 2005, with the
most significant levels of growth reported
for non-trading investments, which
increased by 45 per cent for the year due
primarily to an increase in the fair value of
listed securities held by the Bank. A rise
in Murabaha receivables (excluding
Morabaha commodities) of 14 per cent
during 2005 from BD 44 million to BD 50
million also contributed to the steady
growth in total assets.
This excellent result was due to the
remarkable growth in the Bank's financing
activities as well as the excellent return from
investment operations. This has resulted in a
considerable increase in the total income
from the various activities of the Bank, apart
from realising a substantial rise in the
shareholders' equity.
Business development
During the year, we continued to respond
to the needs of our Retail Banking
customers with innovative Shari’acompliant products and services. These
include a new property financing scheme –
Ijara Muntahia Betamleek – which offers
mortgage finance of up to BD 200,000
with a repayment period extending to 20
years. A new Morabaha car financing
scheme was also introduced for the
purchase of new cars, with a repayment
period of up to seven years. In addition,
two new branches became operational
in 2005, further extending the Bank’s
presence in the Kingdom, and making it
easier for customers to do business with us.
Our Commercial and Corporate Banking
division made good progress during 2005,
as we continued to strengthen our ability
to meet customers’ specific needs and to
further expand our client base. Key
developments include the start of booking
cross-border business, and a substantial
increase in the financing portfolio to smalland-medium-enterprises (SMEs). The Bank
also continued to develop its relationships
with third parties, including a significant
increase in relationships with Islamic
financial institutions in the region.
We were also successful in pursuing our
Investment Banking activities. During
2005, the Bank participated in a number
Return on Avarge Assets (%)
2.5
05
1.5
04
1.1
03
1.0
02
0
0.5
1.0
1.5
2.0
2.5
13
Bahrain Islamic Bank
Annual report 2005
of major Sukuk issues. These include
support for infrastructure projects in
Bahrain a such as Bahrain Financial
Harbour and Durrat Al Bahrain; and
regional projects such as the expansion of
Dubai Ports, and the development of
Lagoon City in Kuwait.
This will be achieved by an increased
focus on the real estate sector; the
addition of new electronic delivery
channels; investing in the latest
technologies; increasing customer service
levels; and streamlining internal processes
and procedures.
New strategy
In 2005, the Board of Directors approved
a new three-year strategic plan. This is
designed to strengthen the Bank’s ability
to succeed in an increasingly competitive
marketplace, and to ensure continued
growth and profitability. A key objective
of the 2006-2008 plan is for the Bank
to become a more active player, not
only in Bahrain but also in the GCC,
through expansion of the branch
network, strategic alliances, and mergers
and acquisitions.
Human resources
Our employees are crucial to the
continued success of the Bank. We
therefore place great importance on
attracting, developing and retaining
the best people in the industry. As part
of our efforts to strengthen our
organisation, in 2005 we successfully
recruited a number of experienced and
qualified professionals to fill senior
positions in critical areas of the Bank’s
operations. The Bank’s headcount rose by
around 10 per cent, while the percentage
”In 2005, the Board of Directors approved a new
three-year strategic plan. This is designed to
strengthen the Bank’s ability to succeed in an
increasingly competitive marketplace, and to ensure
continued growth and profitability.“
of Bahraini nationals employed – 98 per
cent – remained the highest for any
financial institution in the Kingdom.
We also maintained our focus on training
and education. A key achievement in
2005 was the evaluation testing of all
staff in readiness for certification for the
International Computer Driving Licence
(ICDL). Employees will receive training
relevant to their computer experience,
knowledge and skills to prepare them for
ICDL examinations. Already, 38 staff have
concluded their training and received their
ICDL certificates.
Special courses on advanced customer
care were held during 2005 for front-line
staff and Branch personnel, while further
staff attended the Advanced Islamic
Diploma programme at the Bahrain
14
Bahrain Islamic Bank
Annual report 2005
Executive Management Report continued
Institute of Banking and Finance (BIBF).
Also during the year, the Bank sponsored
one of its senior managers to participate
in the Executive Training Programme
organised by the BIBF and the University
of Virginia, USA. This eight-month
specialised programme aims at polishing
the skills and broadening the knowledge
of senior executives.
Technology
During 2005, plans were finalised for a
major upgrade of the Bank’s information
technology infrastructure. A contract was
signed with a leading vendor for the
implementation of a new core banking
system in 2006. This will increase
operating efficiency and effectiveness,
improve internal and external reporting,
facilitate the development of new
products and delivery channels; enhance
customer service; and strengthen the
bank’s competitive edge.
Another key development in 2005 was the
decision to outsource the Bank’s ATM
switch operations to Euronet, a leading
international service provider. This will
provide the Bank with lower transaction
costs, higher security and reduced risks. It
will also enable the Bank to provide a
better service to its customers, with new
features such as credit card cash
withdrawals, and allow an easier migration
to new international EMV smart card
requirements. The agreement with Euronet
is expected to be signed in early 2006.
Credit and risk management
The Bank operates within the overall risk
parameters set forth by the Board of
Directors. As an Islamic commercial bank
operating in the Kingdom of Bahrain, the
Bank works in line with the regulatory
framework of the Bahrain Monetary
Agency, and is fully compliant with the
principles and guidelines of Islamic Shari’a.
The Bank is witnessing rapid growth in
line with its long term strategy which calls
for expansion in the local market, and
increased cross-border exposure to serve
a wider range of new customers with
sophisticated needs. As such, the Bank
has worked towards enhancing its credit
culture. The Credit and Risk Management
division was expanded by enhancing the
capabilities of the various departments
within the division. These comprise credit
review, credit administration, and risk
management. The Bank has recruited well
experienced professionals to carry out
these functions.
Earnings per Share (fils)
30
05
15
04
11
03
9
02
0
5
10
15
20
25
30
15
Bahrain Islamic Bank
The division is responsible for the risk
asset side of the Bank through the
monitoring and control of the various
risk factors inherent in financing and
various investment portions. The credit
risk is minimised though a comprehensive
and rigorous review of all applications
of commercial and corporate customers.
The department monitors and evaluates
the overall exposure to ensure
diversification of the credit risk by
monitoring the concentration of product,
industry and single obligor, together
with a regular review of all accounts.
The legal risk is minimised though the
scrutiny of the financing documentation.
The risk management department looks
at the market risk. The division as a
whole monitors other risk factors such
the market and liquidity risk.
Annual report 2005
The Bank has developed formal credit
policies and procedures, together with
investment and treasury manuals, and a
Directors’ handbook. These manuals set
forth the general guidelines and the
framework under which the Bank
operates and monitors all risk aspects.
Looking ahead
The achievements of 2005 have resulted
in Bahrain Islamic Bank becoming a more
professional, efficient and responsive
institution. Our record financial results,
supported by the numerous organisational
initiatives, have put the Bank on a strong
footing from which to enter 2006 and
take advantage of the many new business
opportunities across the region.
Our focus and direction the coming years
will be governed by the Bank’s new
”The achievements of 2005 have resulted in Bahrain
Islamic Bank becoming a more professional, efficient
and responsive institution. Our record financial
results, supported by the numerous organisational
initiatives, have put the Bank on a strong footing
from which to enter 2006 and take advantage of the
many new business opportunities across the region.“
strategic plan, with the emphasis on
innovation and leadership through people
and technology, in order to provide
greater value for all our stakeholders –
staff, customers, business partners,
investors and shareholders.
Yousif Saleh Khalaf
Chief Executive Officer
16
Bahrain Islamic Bank
Annual report 2005
Shari’a Supervisory Board
Dr. Shaikh A. Latif Mahmood Al Mahmood
Chairman
Shaikh Mohammed Jaffar Al Juffairi
Vice Chairman
Shaikh Nedham M. Saleh Yacoubi
Member
Head of Arabic & Islamic Studies
University of Bahrain
Member Shari’a Supervisory Board
Takaful International
Member Shari’a Supervisory Board
ABC Islamic Bank
Member Joint Shari’a Supervisory Board
AlBaraka Group
Formerly Judge High Shari’a Court of Appeal
and Designated President of the High Shari’a
Court Ministry of Justice
Formerly Member Zakah Committee
Ministry of Islamic Affairs
Member Shari’a Supervisory Board
Abu Dhabi Islamic Bank
Member Shari’a Supervisory Board
National Islamic Bank of Sharjah
Member Shari’a Supervisory Board
Shamil Bank
Member Shari’a Supervisory Board
Arcapita
Member Shari’a Supervisory Board
Gulf Finance House
Member Shari’a Supervisory Board
ABC Islamic Bank
Shaikh Adnan Abdullah Al Qattan
Member
Puisne Justice of the High Shari’a Court,
Ministry of Justice
Chairman Al Sanabel Orphans Care
Chairman Orphans and Widows Welfare
Committee of the Royal Court
President Kingdom of Bahrain Hajj Mission
Dr. Shaikh A. Latif Mahmood Al Mahmood
17
Bahrain Islamic Bank
Annual report 2005
Shari’a Supervisory Board’s Report
To the shareholders of
Bahrain Islamic Bank B.S.C.
In The Name of Allah, most Gracious, most Merciful
Peace and Blessings Be Upon His Messenger
Assalam Alaykum Wa Rahmatu Allah Wa Barakatoh
Pursuant to the powers entitled to the Shari’a Supervisory Board to
supervise over the Bank's activities and investments, we hereby submit
the following report:
The Shari’a Supervisory Board monitored the operations and transactions
and contracts related to transactions carried out by the Bank throughout
the year ended 31 December 2005, to express opinion on the Bank's
commitment to the provisions and principles of Islamic Shari'a in its
activities and investments in accordance to the guidelines and decisions
issued by the Supervisory Board. The Shari’a Supervisory Board believes
that ensuring the conformity of the Bank's activities and investments with
provisions of Islamic Shari'a is the sole responsibility of the Bank's
Management, while the Shari’a Supervisory Board is only responsible for
expressing an independent opinion and preparing a report thereabout.
The Shari’a Supervisory Board’s monitoring functions included the
checking of the Bank’s documents and procedures to scrutinize each
single operation carried out by the Bank, whether directly or through
Shari’a Internal Audit. We planned with Shari'a Internal Audit Department
to carry out monitoring functions through the acquisition of all
information and clarifications that are deemed necessary to confirm that
the Bank did not violate the principles and provisions of Islamic Shari'a.
The Shari'a Internal Audit Department carried out its functions of auditing
the Bank’s transactions and submitting a report to the Shari’a Supervisory
Board, which indicated the Bank's commitment and conformity to the
Shari’a Supervisory Board's opinions.
The Shari’a Supervisory Board obtained data and clarifications that it
deemed necessary to confirm that the Bank did not violate the principles
and provisions of Islamic Shari’a. The Shari’a Supervisory Board held
several meetings throughout the year ended 31 December 2005 and
replied to inquiries, in addition to approving a number of new products
presented by the Management. The Shari’a Supervisory Board discussed
with the Bank's officials all transactions and applications carried out by
the Management throughout the year ending 31st December 2005, and
reviewed the Bank's conformity with the provisions and principles of
Islamic Shari'a, as well as the resolutions and guidelines of the Shari’a
Supervisory Board.
The Shari’a Supervisory Board believes that:
1- Contracts, operations, and transactions conducted by the Bank
throughout the year, ending 31 December 2005 were made in
accordance to the standard contracts pre-approved by the
Supervisory Board.
2- Distribution of profits and losses on investment accounts was in line with
the basis approved by the Supervisory Board in accordance with the
principles pre-approved by the Supervisory Board.
3- No gains resulted from sources or by means prohibited by the provisions
and principles of Islamic Shari'a.
4- Zakah was calculated according to the provisions and principles of Islamic
Shari'a. The Bank distributed Zakah on the statutory reserve, general
reserve and retained earnings. The Shareholder should pay his proportion
of Zakah on his/her shares as stated in the financial report.
5- The Bank was committed to the Shari'a standards issued by the
Accounting & Auditing Organisation for Islamic Financial Institutions.
We pray that Allah may Grant all of us Further Success and Prosperity.
Shari’a Supervisory Board Members:
Dr. Shaikh A. Latif Mahmood Al Mahmood
Chairman of Shari’a Supervisory Board
Shaikh Mohammed Jaffar Al Jiffari
Vice Chairman of Shari’a Supervisory Board
Shaikh Adnan Abdullah Al Qattan
Member of Shari’a Supervisory Board
Shaikh Nedham M. Saleh Yacoubi
Member of Shari’a Supervisory Board
18
Bahrain Islamic Bank
Annual report 2005
Auditor’s Report
To the shareholders of
Bahrain Islamic Bank B.S.C.
We have audited the accompanying consolidated balance sheet of Bahrain Islamic Bank B.S.C. (“the Bank”) and its subsidiary (“the Group”) as of 31
December 2005, and the related consolidated statements of income, cash flows, changes in equity, sources and uses of good faith qard fund and sources
and uses of zakah and charity fund for the year then ended. These consolidated financial statements and the Bank’s undertaking to operate in
accordance with Islamic Shari’a rules and principles are the responsibility of the Bank's board of directors. Our responsibility is to express an opinion on
these consolidated financial statements based on our audit.
We conducted our audit in accordance with both the Auditing Standards for Islamic Financial Institutions and the International Standards on Auditing.
Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free
of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the consolidated financial
statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the
overall consolidated financial statements presentation. We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Group as of 31 December 2005,
the results of its operations, its cash flows, sources and uses of good faith qard fund and sources and uses of zakah and charity fund for the year then
ended in accordance with the Financial Accounting Standards issued by the Accounting and Auditing Organization for Islamic Financial Institutions and
the Shari’a rules and principles as determined by the Shari’a Supervisory Board of the Group.
We confirm that, in our opinion, proper accounting records have been kept by the Bank and the consolidated financial statements, and the contents of
the Report of the Board of Directors relating to these consolidated financial statements, are in agreement therewith. We further report, to the best of our
knowledge and belief, that no violations of the Bahrain Commercial Companies Law, nor of the Bahrain Monetary Agency Law, nor of the memorandum
and articles of association of the Bank, have occurred during the year ended 31 December 2005 that might have had a material adverse effect on the
business of the Bank or on its consolidated financial position and that the Bank has complied with the terms of its banking licence. We obtained all the
information and explanations which we required for the purpose of our audit.
Ernst & Young
18 January 2006
Kingdom of Bahrain
19
Bahrain Islamic Bank
Annual report 2005
Consolidated Balance Sheet
31 December 2005
Assets
Cash and balances with the BMA and other banks
Murabaha receivables
Mudaraba investments
Musharaka investments
Non-trading investments
Investments in associates
Investments in Ijarah assets
Ijarah Muntahia Bittamleek
Investments in properties
Other assets
Note
2002005
Bahraini DiBD ‘000
2004
BD ‘000
3
4
5
6
7
8
9
10
11
12
10,448
156,421
29,459
9,889
80,748
3,382
5,174
12,752
10,341
2,082
9,407
155,476
11,819
2,721
55,770
2,953
5,124
5,116
4,044
2,345
320,696
254,775
47,345
3,562
30,368
2,828
50,907
33,196
14
197,881
168,829
15
15
25,300
2,726
1,360
35,358
7,164
23,000
5,762
828
18,100
5,060
Total Assets
LIABILITIES, UNRESTRICTED INVESTMENT ACCOUNTS AND EQUITY
Liabilities
Customers’ current accounts
Other liabilities
13
Total Liabilities
Unrestricted Investment Accounts
Equity
Share capital
Share premium
Retained earnings
Reserves
Proposed appropriations
15
21
Total Equity
Total Liabilities, Unrestricted Investment Accounts and Equity
Commitments and Contingent Liabilities
22
71,908
52,750
320,696
254,775
7,090
5,561
These consolidated financial statements were authorised for issue in accordance with a resolution of the Board of Directors on 18 January 2006.
Khalid Abdulla Al Bassam
Chairman
The attached notes 1 to 32 form part of these consolidated financial statements
Yousif Saleh Khalaf
Chief Executive Officer
20
Bahrain Islamic Bank
Annual report 2005
Consolidated Statement of Income
Year Ended 31 December 2005
Income
Income from Islamic financing
Note
2005
BD ‘000
2004
BD ‘000
16
12,348
7,686
Return on unrestricted investment accounts before Bank’s share as a Mudarib
Bank’s share as a Mudarib
5,627
(571)
2,417
(343)
Return to unrestricted investment accounts
5,056
2,074
Bank’s share of income from unrestricted investment accounts (as a Mudarib and Rabalmal)
7,292
5,612
Income from investments
Gain on fair value adjustment for investments in properties
Bank’s share in the profit of associates
Other income
2,238
1,991
454
626
2,340
232
115
450
Total Income
12,601
8,749
Expenses
Staff costs
Depreciation
Other expenses
3,248
564
1,399
2,771
545
1,421
5,211
4,737
7,390
-
4,012
(184)
(123)
7,390
3,705
29.89
14.98
8
17
Total Expenses
Net income before provisions and Zakah
Provisions
Zakah
18
19
Net Income for the Year
Basic Earnings per Share (fils)
Khalid Abdulla Al Bassam
Chairman
The attached notes 1 to 32 form part of these consolidated financial statements
20
Yousif Saleh Khalaf
Chief Executive Officer
21
Bahrain Islamic Bank
Annual report 2005
Consolidated Statement of Cash Flows
Year Ended 31 December 2005
Operating Activities:
Net income for the year
Adjustments for non-cash items:
Depreciation
Provisions – net
Bank’s share in the profit of associates
Gain on sale of investments in properties and Ijarah assets
Gain on fair value adjustment for investments in properties
2005
BD ‘000
2004
BD ‘000
7,390
3,705
564
(454)
(473)
(1,991)
545
184
(115)
(232)
5,036
4,087
Changes in:
Mandatory reserve with BMA
Murabaha receivables
Mudaraba investments
Musharaka investments
Ijarah Muntahia Bittamleek
Other assets
Customers’ current accounts
Other liabilities
173
(945)
(17,640)
(7,168)
(7,698)
(63)
16,977
873
357
(14,527)
5,299
485
(2,631)
(724)
1,490
(307)
Net cash used in operating activities
(10,455)
(6,471)
Investing Activities:
Income received from associates
(Purchase) disposal of investments in properties and Ijarah assets
Purchase of non-trading investments and associates
(4,059)
(10,425)
33
1,694
(3,012)
Net cash used in investing activities
(14,484)
(1,285)
Financing Activities:
Increase in unrestricted investment accounts
Dividends paid
Directors' remuneration
Charitable contributions
29,052
(2,754)
(100)
(45)
9,300
(2,300)
(70)
(40)
Net cash from financing activities
26,153
6,890
Operating profit before changes in operating assets and liabilities
Net Increase (Decrease) in Cash and Cash Equivalents
1,214
(866)
Cash and cash equivalents at 1 January
3,269
4,135
Cash and Cash Equivalents at 31 December (note 3)
4,483
3,269
The attached notes 1 to 32 form part of these consolidated financial statements
22
Bahrain Islamic Bank
Annual report 2005
Consolidated Statement of Changes in Equity
Year Ended 31 December 2005
200
Share
Share
capital
premium
BD ‘000 BahraiBD ‘000
Balance at 31 December 2003
Statutory
reserve
BD ‘000
Reserves
Investments
General
fair value
reserve
reserve
BD ‘000
BD ‘000
Cumulative
changes in
fair value
BD ‘000
Retained
Proposed
earnings appropriations
BD ‘000
BD ‘000
Total
equity
BD ‘000
23,000
8,062
3,119
1,000
137
1,725
646
2,300
39,989
Dividends paid
-
-
-
-
-
-
-
(2,300)
(2,300)
Net profit for the year
-
-
-
-
-
-
3,705
-
3,705
Transfer to statutory reserve
-
-
371
-
-
-
(371)
-
-
-
-
-
-
232
-
(232)
-
-
-
-
-
-
-
11,516
-
-
11,516
Unrealized gain on
investments in properties
Net movement in cumulative
changes in fair values
Directors’ remuneration
-
-
-
-
-
-
(100)
-
(100)
Charitable contributions
Proposed appropriations (note 21)
-
(2,300)
-
-
-
-
(60)
(2,760)
5,060
(60)
-
Balance at 31 December 2004
Bonus shares issued (note 21)
Dividends paid
Net profit for the year
Transfer to statutory reserve
Unrealized gain on
investments in properties
Net movement in cumulative
changes in fair values
Proposed appropriations (note 21)
23,000
2,300
-
5,762
-
3,490
739
1,000
-
369
-
13,241
-
828
7,390
(739)
5,060
(2,300)
(2,760)
-
52,750
(2,760)
7,390
-
-
-
-
-
1,991
-
(1,991)
-
-
-
(3,036)
-
-
-
14,528
-
(4,128)
7,164
14,528
-
Balance at 31 December 2005
25,300
2,726
4,229
1,000
2,360
27,769
1,360
7,164
71,908
The attached notes 1 to 32 form part of these consolidated financial statements
23
Bahrain Islamic Bank
Annual report 2005
Consolidated Statement of Sources and Uses of Good Faith Qard Fund
Year Ended 31 December 2005
2005
BD ‘000
2004
BD ‘000
125
3
125
3
128
128
109
14
91
33
123
124
Marriage
Refurbishment
Medical treatment
Others
-
8
4
1
2
Total uses
-
15
123
5
109
19
128
128
Original sources of Qard Fund
Contribution by the Bank (Note 4)
Donations
Movement of Funds
Cash balance at the beginning of the year
Installments received
Uses of Qard Fund
Cash balance at the end of the year
Qard Hasan installments outstanding as at end of the year
The attached notes 1 to 32 form part of these consolidated financial statements
24
Bahrain Islamic Bank
Annual report 2005
Consolidated Statement of Sources and Uses of Zakah and Charity Fund
Year Ended 31 December 2005
2005
BD ‘000
2004
BD ‘000
Undistributed zakah and charity funds at the beginning of the year
Zakah due from the Bank for the year (note 19)
147
138
126
123
Total sources of funds during the year
285
249
University and school students
Philanthropic societies
Aid to needy families
10
119
17
10
70
22
Total uses of funds during the year
146
102
Undistributed zakah and charity funds at end of the year (note 19)
139
147
Sources of Zakah and Charity Funds
Uses of zakah and charity funds
The attached notes 1 to 32 form part of these consolidated financial statements
25
Bahrain Islamic Bank
Annual report 2005
Notes to the Consolidated Financial Statements
31 December 2005
1. Incorporation and Activities
Bahrain Islamic Bank B.S.C. (“the Bank”) was incorporated in the Kingdom of Bahrain by Amiri Decree No.2 of 1979, under Commercial Registration (CR)
number 9900, to carry out banking and other financial trading activities in accordance with the teachings of Islam (Shari’a). The Bank operates under a
commercial banking licence issued by the Bahrain Monetary Agency. The Bank’s Shari’a Supervisory Board is entrusted to ensure the Bank’s adherence to
Shari’a rules and principles in its transactions and activities.
The Bank participated in 100% of the share capital in Al Emar Real-Estate Company B.S.C. (“subsidiary”). Al Emar was incorporated on 8 April 2003 and
has an authorised share capital of BD 10,000,000 of which BD 1,000,000 is paid-up. Al Emar has not started its operations since the incorporation date.
The Bank’s registered office is at Building 722, Road 1708, Block 317, Manama, Kingdom of Bahrain.
The Bank has twelve branches (2004: twelve), all operating in the Kingdom of Bahrain.
2. Significant Accounting Policies
The significant accounting policies adopted in the preparation of the consolidated financial statements are set out below:
Basis of preparation
These consolidated financial statements have been prepared in accordance with the Financial Accounting Standards issued by the Accounting and
Auditing Organisation for Islamic Financial Institutions (AAOIFI) and the Bahrain Commercial Companies Law. In accordance with the requirement of
AAOIFI, for matters for which no AAOIFI standards exist, the Bank uses the relevant International Financial Reporting Standards issued by the International
Accounting Standards Board.
The consolidated financial statements are prepared under the historical cost convention as modified for the re-measurement at fair value of investment in
properties and certain non-trading investments "available for sale".
The accounting policies, with the exception of the adoption of the revised versions of IAS 32 and 39, are consistent with those used in the previous year.
These consolidated financial statements are prepared in Bahraini Dinars, being the principal currency of the Group’s operations.
Basis of consolidation
The consolidated financial statements include the financial statements of the Bank and its subsidiary. A subsidiary is an entity over which the Bank has
power to control which is other than fiduciary in nature. The subsidiary has been consolidated from the date it was incorporated. All intercompany
balances and income have been eliminated on consolidation.
Financial contracts
Financial contracts consist of Murabaha receivables, Mudaraba investments and Musharaka investments. Balances relating to these contracts are stated
net of deferred profit and of provisions for impairment.
Non-trading investments
These are classified as either held-to-maturity or available-for-sale.
All investments are initially recognised at cost, being the fair value of the consideration given including acquisition charges associated with the investment.
Premiums and discounts are amortised on a systematic basis to maturity.
26
Bahrain Islamic Bank
Annual report 2005
Notes to the Consolidated Financial Statements
31 December 2005
2. Significant Accounting Policies (continued)
Non-trading investments (continued)
Held-to-maturity
Investments that have fixed or determinable payments, which are intended to be held-to-maturity, are carried at amortised cost, less provision for
impairment in value. Amortised cost is calculated by taking into account any discount or premium on acquisition. Any gain or loss on such investments is
recognised in the consolidated statement of income when the investment is derecognised or impaired.
Available-for-sale
After initial recognition, investments that are classified as “available-for-sale” are re-measured at fair value. The fair value changes of investments available
for sale are reported in equity until such time as the investments are sold, realised or deemed to be impaired, at which time the realised gain or loss is
reported in the consolidated statement of income.
Investment in associates
Associates are enterprises in which the Group exercises significant influence but not control. Investments in associates are accounted for using the equity
method of accounting.
Ijarah assets, Ijarah Muntahia Bittamleek and equipment
These are initially recorded at cost. Ijarah assets and Ijarah Muntahia Bittamleek comprise of land, buildings and equipment.
Depreciation is provided on a straight-line basis on all equipment, Ijarah assets and Ijarah Muntahia Bittamleek other than land (which is deemed to have
indefinite life), at rates calculated to write off the cost of each asset over its expected useful life.
The estimated useful lives of the assets for the calculation of depreciation are as follows:
Ijarah assets and Ijarah Muntahia Bittamleek – buildings
Equipment
10 to 35 years
3 to 5 years
Investments in properties
Properties held for rental or for capital appreciation purposes or both are classified as investments in properties. Investments in properties are initially
recorded at cost, being the fair value of the consideration given and acquisition charges associated with the property. Subsequent to initial recognition,
investments in properties are measured at fair value and changes in fair value are recognised in the consolidated statement of income.
Unrestricted investment account holders
All unrestricted investment accounts are carried at cost plus profit less amounts repaid.
Zakah
Zakah is calculated on the Zakah base of the Group in accordance with the Financial Accounting Standards issued by the Accounting and Auditing
Organisation for Islamic Financial Institutions using the net invested funds method. Zakah is paid by the Group based on statutory reserve, general reserve
and retained earning balances at the beginning of the year. The remaining Zakah is payable by individual shareholders. Payment of Zakah on unrestricted
investment and other accounts is the responsibility of investment account holders.
Employees’ end of service benefits
Provision is made for amounts payable under the Bahrain Labour Law applicable to non-Bahraini employees’ accumulated periods of service at the balance
sheet date. Bahraini employees are covered under the General Organisation for Social Insurance scheme.
27
Bahrain Islamic Bank
Annual report 2005
Notes to the Consolidated Financial Statements
31 December 2005
2. Significant Accounting Policies (continued)
Fair values of financial instruments
For investments traded in organised financial markets, fair value is determined by reference to quoted market bid prices at the close of business on the
balance sheet date.
For investments where there is no quoted market price, a reasonable estimate of the fair value is determined by reference to the current market value of
another instrument which is substantially the same, or is based on an assessment of the value of future cash flows. For financial contracts, future cash
flows are determined by the Group at current profit rates for financing contracts with similar terms and risk characteristics.
Provisions
Provisions are recognised when the Group has a present obligation (legal or constructive) arising from a past event and the costs to settle the obligation
are both probable and able to be reliably measured.
Offsetting
Financial assets and financial liabilities are only offset and the net amount reported in the consolidated balance sheet when there is a legally enforceable
right to set off the recognised amounts and the Group intends to either settle on a net basis, or to realise the asset and settle the liability simultaneously.
Revenue recognition
Murabaha receivables
Where the income is quantifiable and contractually determined at the commencement of the contract, income is recognised on a time-apportioned basis
over the period of the contract based on the principal amounts outstanding. Where the income from a contract is not quantifiable, it is recognised when
realised. Income that is 90 days or more overdue is excluded from income.
Musharaka investments
Income is recognised on the due dates of the installments or when received in case of sale Musharaka. Income that is 90 days or more overdue is
excluded from income.
Mudaraba investments
Income is recognised when it is quantifiable or on distribution by the Mudarib, whereas the losses are charged to income on their declaration by the Mudarib.
Dividends
Dividends from investments in equities are recognised when the right to receive payment is established.
Ijarah and Ijarah Muntahia Bittamleek
Ijarah income and income from Ijarah Muntahia Bittamleek is recognised on a time-apportioned basis over the lease term.
Group’s share as a Mudarib
The Group’s share as a Mudarib for managing unrestricted investment accounts is accrued based on the terms and conditions of the related
management agreements.
Fee and commission income
Fee and commission income is recognised when earned.
Income allocation
Income is allocated proportionately between unrestricted investment accounts and shareholders on the basis of the average balances outstanding
during the year.
28
Bahrain Islamic Bank
Annual report 2005
Notes to the Consolidated Financial Statements
31 December 2005
2. Significant Accounting Policies (continued)
Foreign currencies
Monetary assets and liabilities in foreign currencies are translated into Bahraini Dinars at the rates of exchange ruling at the balance sheet date. Any resultant
gains or losses are taken to the consolidated statement of income.
Translation gains or losses on non-monetary items carried at fair value are included in equity as part of the fair value adjustment on securities available-for-sale.
Cash and cash equivalents
Cash and cash equivalents comprise cash and balances with Bahrain Monetary Agency and other banks maturing within 90 days of the date of acquisition.
Impairment of financial assets
An assessment is made at each balance sheet date to determine whether there is objective evidence that a specific financial asset may be impaired. If
such evidence exists, any impairment loss, is recognised in the statement of income.
Impairment is determined as follows:
(a) for assets carried at amortised cost, impairment is based on estimated cash flows as discounted by the original effective profit rate.
(b) for assets carried at fair value, impairment is the difference between cost and fair value.
(c) for assets carried at cost, impairment is present value of future cash flows discounted at the current market rate of return for a similar financial asset.
For available for sale equity investments reversal of impairment losses are recorded as increases in cumulative changes in fair value through equity.
Trade and settlement accounting
All “regular way” purchases and sales of financial assets are recognised on the trade date, i.e. the date that the Bank commits to purchase or sell the asset.
Judgements
In the process of applying the Bank’s accounting policies, management has made the following judgements, apart from those involving estimations, which
have the most significant effect in the amounts recognised in the financial statements:
Classification of investments
Management decides on acquisition of an investment whether it should be classified as held to maturity or available for sale.
For those deemed to be held to maturity management ensures that the requirements of FAS 17 and IAS 39 are met and in particular the Bank has the
intention and ability to hold these to maturity.
The Bank classifies investments as trading if they are acquired primarily for the purpose of making a short term profit by the dealers.
All other investments are classified as available for sale.
Estimation uncertainty
The key assumption concerning the future and other key sources of estimation uncertainty at the balance sheet date, that has a significant risk of causing a
material adjustment to the carrying amounts of assets and liabilities within the next financial year is in relation to impairment of financial assets discussed below:
The Bank reviews its doubtful financing on a quarterly basis to assess whether a provision for impairment should be recorded in the statement of income. In
particular, considerable judgement by management is required in the estimation of the amount and timing of future cash flows when determining the level of
provisions required. Such estimates are necessarily based on assumptions about several factors involving varying degrees of judgment and uncertainty, and
actual results may differ resulting in future changes to such provisions.
29
Bahrain Islamic Bank
Annual report 2005
Notes to the Consolidated Financial Statements
31 December 2005
3. Cash and Balances with the BMA and Other Banks
2005
BahrainBD ‘000
2004
BD ‘000
Cash and balances with BMA, excluding mandatory reserve deposits
Balances with other banks
2,125
2,358
1,939
1,330
Cash and cash equivalents
Mandatory reserve with BMA
4,483
5,965
3,269
6,138
10,448
9,407
2005
BD ‘000
2004
BD ‘000
105,287
111,597
Other Murabahas:
Tawaroq
Land
Buildings
Letters of credit
Motor vehicles
Building materials
Furniture
Others
7,940
10,230
5,859
18,053
4,950
11,740
350
1,670
1,044
12,010
5,844
14,300
6,558
12,566
482
1,422
Qard fund
60,792
125
54,226
125
60,917
54,351
166,204
165,948
The mandatory reserve with BMA is not available for use in the day-to-day operations.
4. Murabaha Receivables
Murabahas with banks:
International commodities
Deferred profits
Provision (note 18)
(7,997)
(1,786)
156,421
(8,665)
(1,807)
155,476
Non-performing Murabaha receivables outstanding as of 31 December 2005 amounted to BD 2,275 thousand (2004: BD 2,842 thousand). The Bank
considers the promise made in the Murabaha to the purchase order as obligatory.
30
Bahrain Islamic Bank
Annual report 2005
Notes to the Consolidated Financial Statements
31 December 2005
4. Murabaha Receivables (continued)
The composition of the Murabaha transaction portfolio is as follows:
2
Europe
Bahraini DBD ‘000
Arab World
BD ‘000
2005
Total
BD ‘000
2004
Total
BD ‘000
Commercial
Financial institutions
Secured by real estate
Others
4,537
-
18,053
100,750
27,829
15,035
18,053
105,287
27,829
15,035
14,300
111,597
17,854
22,197
31 December 2005
4,537
161,667
166,204
31 December 2004
7,454
158,494
165,948
5. Mudaraba Investments
Mudaraba investments
Provision (note 18)
2005
BD ‘000
2004
BD ‘000
29,459
-
11,979
(160)
29,459
11,819
The Bank’s Mudaraba investments transactions consist of investment in funds operated by other banks and financial institutions and participation in the
financing transactions through other banks and financial institutions.
There are no non-performing Mudaraba investments as of 31 December 2005 (2004: BD 166 thousand).
6. Musharaka Investments
2005
BD ‘000
Real estate financing
Provision (note 18)
9,939
(50)
2,771
(50)
9,889
2,721
Non-performing Musharaka investments outstanding as of 31 December 2005 amounted to BD 50 thousand (2004: BD 764 thousand).
The Bank’s ownership in Musharaka varies according to contractual arrangements.
2004
BD ‘000
31
Bahrain Islamic Bank
Annual report 2005
Notes to the Consolidated Financial Statements
31 December 2005
7. Non-Trading Investments
Quoted investments
Equity shares
Unquoted investments
Sukook (Islamic bonds)
Equity shares
Total
Provision (note 18)
Available-for-sale
BD ‘000
Held-to-maturity
BD ‘000
2005
Total
BD ‘000
2004
Total
BD ‘000
34,053
-
34,053
17,072
2,911
2,911
44,112
44,112
44,112
2,911
47,023
36,316
2,710
39,026
36,964
44,112
81,076
56,098
(328)
-
31 December 2005
36,636
44,112
31 December 2004
19,455
36,315
(328)
(328)
80,748
55,770
The unquoted equities amounting to BD 2,911 thousand (2004: BD 2,710 thousand) are carried at cost less impairment provision. This is due to the
unpredictable nature of future cash flows and the lack of suitable other methods for arriving at a reliable fair value. In management’s opinion the fair
value of these investments are not less than the carrying amount.
8. Investments in Associates
The Bank has the following investments in associates:
Takaful International Company B.S.C.
Liquidity Management Centre B.S.C. (c)
Country
of incorporation
Ownership
2005
Ownership
2004
Kingdom of Bahrain
Kingdom of Bahrain
22.75%
25.00%
22.75%
25.00%
Takaful International Company B.S.C. (incorporated in 1989) carries out takaful and retakaful activities in accordance with the teachings of Islamic Shari’a.
Liquidity Management Centre B.S.C. (c) was set up in 2002 to facilitate the creation of an Islamic inter-bank market that will allow Islamic financial
services institutions to effectively manage their assets and liabilities.
The following tables illustrate summarised financial information relating to the Bank's associates:
Carrying amount of investments in associates
2005
BD ‘000
2004
BD ‘000
At 1 January
Share of results
Dividends paid
Fair Market Value
2,953
454
(25)
2,870
115
(68)
36
At 31 December
3,382
2,953
32
Bahrain Islamic Bank
Annual report 2005
Notes to the Consolidated Financial Statements
31 December 2005
9. Investments in Ijarah Assets
2
Cost:
At 1 January
Additions / Disposals / Re-classifications
At 31 December
Depreciation:
At 1 January
Provided during the year
Disposals
At 31 December
Land
Bahraini DBD ‘000
Buildings
BD ‘000
2005
Total
BD ‘000
2004
Total
BD ‘000
989
391
5,640
-
6,629
391
6,747
47
1,380
5,640
7,020
6,794
-
1,670
176
-
1,670
176
-
1,380
307
(17)
-
1,846
1,846
1,670
1,380
3,794
5,174
5,124
2005
BD ‘000
2004
BD ‘000
Net book value:
As at 31 December
10. Ijarah Muntahia Bittamleek
200
Bahraini D
Cost:
At 1 January
Additions
Disposal
At 31 December
Depreciation:
At 1 January
Provided during the year
Relating to disposed assets
At 31 December
5,290
9,198
(1,500)
3,464
2,631
(805)
12,988
5,290
174
211
(149)
123
92
(41)
236
174
12,752
5,116
Net book value:
As at 31 December
33
Bahrain Islamic Bank
Annual report 2005
Notes to the Consolidated Financial Statements
31 December 2005
11. Investments in Properties
200
Bahraini D
Carrying value
Additions
Disposals / Re-classifications
Fair value adjustments
Balance at the end of the year
2005
iBD ‘000
2004
BD ‘000
3,729
5,023
(717)
4,839
847
(1,957)
8,035
3,729
2,306
315
10,341
4,044
2005
iBD ‘000
2004
BD ‘000
1,147
448
63
424
1,165
715
98
367
2,082
2,345
2005
iBD ‘000
2004
BD ‘000
418
920
596
711
142
49
726
972
466
314
107
136
52
781
3,562
2,828
12. Other Assets
200
Bahraini D
Equipment
Receivables under letter of credit
Profit earned not received
Others
13. Other Liabilities
200
Bahraini D
Margin on letters of credit
Managers’ cheques
Accrued expenses
Murabaha bills payable
Dividends payable
Provision for employees’ end of service benefits and leave
Others
34
Bahrain Islamic Bank
Annual report 2005
Notes to the Consolidated Financial Statements
31 December 2005
14. Unrestricted Investment Accounts
Customers’ investment accounts
Investments by banks and other financial institutions
Cumulative changes in fair value reserve
2005
BD ‘000
2004
BD ‘000
140,917
54,323
2,641
128,567
40,262
-
197,881
168,829
The Bank’s share, as Mudarib, in the profits of unrestricted investment accounts ranges from 15% to 45% (same as in the previous year).
2005
2004
Percentage
Bahraini Dof funds invested
Percentage
distribution
for December
Percentage
Dof funds invested
Percentage
distribution
for December
75
100
80
90
50
90
3.70
3.5-3.9
3.90
4.20
0.80
4.20
75
100
80
90
50
90
1.80
1.6-1.9
2.05
2.15
0.75
2.15
2005
BD ‘000
2004
BD ‘000
(a) Authorised
500,000,000 shares of BD 0.100 each
50,000
50,000
(b) Issued and fully paid-up
253,000,000 shares (2004: 230,000,000 shares) of BD 0.100 each
25,300
23,000
Defined deposits
Specific investment deposits
Continuous deposits
Investment certificates
Savings accounts
Education and shifa
15. Equity
(i) Share Capital
(ii) Share premium
Amounts collected in excess of the par value of the issued share capital during any new issue of shares, net of issue expenses, are treated as share
premium. This amount is not available for distribution, but can be utilised as stipulated by the Bahrain Commercial Companies Law.
(iii) Reserves
Statutory reserve
As required by Bahrain Commercial Companies Law and the Bank’s articles of association, 10% of the net profit for the year is transferred to the statutory
reserve. The Bank may resolve to discontinue such annual transfers when the reserve totals 50% of paid up share capital. The reserve is not distributable
except in such circumstances as stipulated in the Bahrain Commercial Companies Law and following the approval of the Bahrain Monetary Agency.
35
Bahrain Islamic Bank
Annual report 2005
Notes to the Consolidated Financial Statements
31 December 2005
15. Equity (continued)
General reserve
The general reserve is established in accordance with the articles of association of the Bank and is distributable following a resolution of shareholders at a
general meeting and the approval of the Bahrain Monetary Agency.
Investments fair value reserve
This represents unrealised revaluation gains on investments in properties.
Cumulative changes in fair value
This represents the net unrealised gains on available-for-sale investments.
The Bank's management transferred BD 2,641 thousand from the cumulative changes in fair value reserve to unrestricted investment account holders
representing the unrestricted investment account holders portion in this reserve.
16. Income from Islamic Financing
200
Income from Murabaha receivables
Income from Mudaraba investments
Income from Musharaka investments
Income from investments in Sukook
Ijarah Muntahia Bittamleek income
2005
BD ‘000
2004
BD ‘000
8,401
727
481
1,736
1,003
5,590
674
74
1,104
244
12,348
7,686
2005
BD ‘000
2004
BD ‘000
189
262
193
167
129
64
66
66
22
241
180
216
204
158
187
67
61
73
27
248
1,399
1,421
17. Other Expenses
200
Bahraini D
Expenses on Ijarah assets
Expenses on premises and equipment
Computer maintenance
Communication expenses
Advertisements and subscriptions
Registration fees
Stationery expenses
Professional fees
Shari’a committee remuneration
Miscellaneous
36
Bahrain Islamic Bank
Annual report 2005
Notes to the Consolidated Financial Statements
31 December 2005
18. Provisions
Murabaha
receivables
2005
BD’ 000
Mudaraba
investments
2005
BD’ 000
160
(160)
Musharaka
investments
2005
BD’ 000
Non-trading
investments
2005
BD’ 000
50
-
328
-
2,345
(181)
2,166
(6)
Total
2005
BD’ 000
Total
2004
BD’ 000
Provision at beginning of the year
Written off during the year
1,807
(21)
Provided during the year
1,786
-
-
50
-
328
-
2,164
-
2,160
184
Provision at end of the year
1,786
-
50
328
2,164
2,344
Note 4
Note 5
Note 6
Note 7
19. Zakah
Zakah payable amounted to BD 878 thousand for the year ended 31 December 2005 (2004: BD 847 thousand). The amount that will be paid by the Group is
BD 138 thousand (2004: BD 123 thousand) which represents the Zakah on the statutory reserve, general reserve and retained earning balances at the
beginning of the year. The remaining Zakah balance amounting to BD 740 thousand (2004: BD 724 thousand) is due and payable by the shareholders at 2.9
fils per share (2004: 3.2 fils per share).
The Bank has changed the treatment of Zakah from the year 2005. Instead of charging it to the statement of income as an expense, it is now treated as
an appropriation from the retained earnings.
20. Earnings per Share
Basic earnings per share is calculated by dividing the net profit for the year by the weighted average number of shares during the year as follows:
Net profit for the year
Weighted average number of shares
Basic earnings per share (fils)
2005
BD ‘000
2004
BD ‘000
7,390
3,705
247,250
247,250
29.89
14.98
37
Bahrain Islamic Bank
Annual report 2005
Notes to the Consolidated Financial Statements
31 December 2005
21. Proposed Appropriations
200
Bahraini D
Proposed dividend
Bonus shares
Directors' remuneration
Zakah (note 19)
Charitable contributions
2005
BD ‘000
2004
BD ‘000
3,795
3,036
120
138
75
2,760
2,300
-
7,164
5,060
The directors have proposed a cash dividend of 15 fils per share (2004: 12 fils per share). This will be submitted for formal approval at the Annual
General Meeting.
In addition, in the Board of Directors' meeting held on 18 January 2006, it was decided to issue bonus shares at twelve bonus shares for each hundred
shares held. This is subject to relevant approval from the Ministry of Industry and Commerce, Bahrain Monetary Agency and shareholders' meeting.
The dividend of BD 2,760 thousand proposed for the year 2004 was approved at Annual General Meeting in 15 February 2005 and was paid in 2005
following that approval.
The Bank issued bonus shares at one bonus share for each ten shares held following shareholders' approval and the Board of Directors' resolution in its
meeting held on 15 February 2005. This was also approved by the Ministry of Industry and Commerce and Bahrain Monetary Agency.
22. Commitments and Contingent Liabilities
Credit related commitments
These include commitments to enter into financing contracts which are designed to meet the requirements of the Bank’s customers.
Commitments represent contractual commitments under Murabaha receivables, Mudaraba investments, Musharaka investments and Ijarah Muntahia
Bittamleek contracts. Commitments generally have fixed expiration dates, or other termination clauses. Since commitments may expire without being drawn
upon, the total contract amounts do not necessarily represent future cash flow requirements.
Letters of credit and guarantees commit the Bank to make payments on behalf of customers.
The Group has the following credit related commitments and contingent liabilities on behalf of customers:
Letters of credit
Guarantees
2005
BD ‘000
2004
BD ‘000
5,494
1,596
4,585
976
7,090
5,561
38
Bahrain Islamic Bank
Annual report 2005
Notes to the Consolidated Financial Statements
31 December 2005
22. Commitments and Contingent Liabilities (continued)
Operating lease commitments
The Bank has entered into commercial leases for certain branches. These leases have an average life of between 5 and 10 years with renewal terms
included in the contracts. Renewals are at the option of the specific entity that holds the lease. There are no restrictions placed upon the lessee by
entering into these leases.
Future minimum rentals payable under non-cancellable operating leases as at 31 December are as follows:
Within one year
After one year but not more than five years
More than five years
2005
BD ‘000
2004
BD ‘000
93
177
19
78
190
27
289
295
23. Related Party Transactions
The Group enters into transactions with major shareholders, directors, management and companies of which they are principal owners in the ordinary course
of business at commercial rates. All the financing contracts with related parties are performing and are free of any provision for possible impairment.
The balances and values of major transactions with the related parties are as follows:
Income (expense)
Name of Related Party
Transactionahra
Board of Directors
Management
Murabaha receivables
Murabaha receivables
2005
BD’ 000
2004
BD’ 000
119
-
44
9
Balance at 31 December
2005
2004
BD’ 000
BD’ 000
1,889
-
1,499
106
2005
BD ‘000
2004
BD ‘000
75
4
50
3
79
53
Compensation of the key management personnel is as follows:
Short term employee benefits
Other long term benefits
39
Bahrain Islamic Bank
Annual report 2005
Notes to the Consolidated Financial Statements
31 December 2005
24. Credit Risk
Type of credit risk
Various contracts entered into by the Bank comprise Murabaha receivables, Musharaka investments, Mudaraba investments and Ijarah Muntahia Bittamleek
contracts. Murabaha receivables contracts cover land and properties, building materials, furniture, motor vehicles and others. Musharaka investments finance
joint investments with individuals and commercial entities. Mudaraba investments consist of financing transactions entered through other Islamic banks and
financial institutions.
Murabaha receivables
These are basically sales on deferred terms.
The Bank arranges a Murabaha transaction by buying a commodity (which represents the object of the Murabaha) and then sells this commodity to the
Murabeh (beneficiary) after adding a margin of profit over the cost. The sale price (cost plus profit margin) is repaid in installments by the Murabeh over the
agreed period.
Musharaka investments
Musharaka is a form of partnership between the Bank and its clients whereby each party contributes to the capital of partnership in equal or varying
degrees to establish a new project or share in an existing one, whereby each of the parties becomes an owner of the capital on a permanent or declining
basis. Profits are shared in an agreed ratio, but losses are shared in proportion to the amount of capital contributed. In a declining Musharaka the
partner buys the Bank's share over an agreed period.
Mudaraba investments
Mudaraba investments is a partnership where the Bank ("rabbalmal") gives money to another ("Mudarib") for investing in a commercial enterprise for a
definite period of time.
Ijarah Muntahia Bittamleek
The legal title of the leased asset under Ijarah Muntahia Bittamleek passes to the lessee at the end of the Ijarah term, provided that all Ijarah installments
are settled and the lessee purchases the asset.
Risk management
Credit risk is the risk that one party to a financial contract will fail to discharge an obligation and cause the other party to incur a financial loss. The Bank
controls credit risk by monitoring credit exposures, and continually assessing the creditworthiness of counterparties.
Concentrations of credit risk arise when a number of counterparties are engaged in similar business activities, or activities in the same geographic region, or
have similar economic features that would cause their ability to meet contractual obligations to be similarly affected by changes in economic, political or other
conditions. Concentrations of credit risk indicate the relative sensitivity of the Bank's performance to developments affecting a particular industry or
geographic location. The Bank seeks to manage its credit risk exposure through diversification of financing activities to avoid undue concentrations of risks
with individuals or groups of customers in specific locations or businesses.
40
Bahrain Islamic Bank
Annual report 2005
Notes to the Consolidated Financial Statements
31 December 2005
25. Concentrations of Assets, Liabilities, Unrestricted Investment Accounts, Commitments and Contingent Liabilities
The distribution by geographic region and industry sector was as follows:
Geographical region
North America
Europe
Middle East
Asia
Industry sector
Trading and manufacturing
Banks and financial institutions
Others
Liabilities and unrestricted
investment accounts
BD’ 000
31 December
31 December
2005
2004
Commitments and
contingent liabilities
BD’ 000
31 December
31 December
2005
2004
31 December
2005
Assets
BD’ 000
31 December
D2004
3,446
8,546
308,599
105
2,357
8,503
243,866
49
248,788
-
202,025
-
450
755
3,500
2,385
310
1,200
2,401
1,650
320,696
254,775
248,788
202,025
7,090
5,561
23,205
227,147
70,344
32,153
170,001
52,621
90,246
101,709
56,833
91,830
40,262
69,933
7,090
-
5,561
-
320,696
254,775
248,788
202,025
7,090
5,561
26. Currency Risk
The Group had no significant foreign currency exposures.
27. Profit Share Risk
The Group is not exposed to interest rate risk of its financial assets as no interest is charged.
However, the fair value of financial assets may be affected by current market forces including interest rates. The Group recognises income on certain of its
financial assets on a time-apportioned basis. The following table indicates the profit rates on these at the balance sheet date based on the annualised income
to be recognised, expressed as a percentage of the principal outstanding.
Murabaha with banks
Other Murabaha
Mudaraba investments
Musharaka investments
Ijarah Muntahia Bittamleek
2005
%
2004
%
3.3
9.3
5.4
9.1
8.5 - 9.5
1.5
8.5
4.5
3.5
7.5 - 8.5
41
Bahrain Islamic Bank
Annual report 2005
Notes to the Consolidated Financial Statements
31 December 2005
28. Liquidity Risk
Liquidity risk is the risk that an institution will be unable to meet its net funding requirements. Liquidity risk can be caused by market disruptions or credit
downgrades which may cause certain sources of funding to cease immediately. To guard against this risk, the Group has a large customer base and assets are
managed with liquidity in mind, maintaining a healthy balance of cash, cash equivalents, and international commodity Murabahas.
The table below summarises the maturity profile of the Group’s assets and liabilities. The contractual maturities of assets and liabilities have been determined
on the basis of the remaining period at the balance sheet date to the contractual maturity date and do not take account of the effective maturities as
indicated by the Group’s deposit retention history and the availability of liquid funds.
The maturity profile of assets, liabilities, unrestricted investment accounts and equity at 31 December 2005 was as follows:
Assets
Cash and balances with the
BMA and other banks
Murabaha receivables
Mudaraba investments
Musharaka investments
Non-trading investments
Investments in associates
Investments in Ijarah assets
Ijarah Muntahia Bittamleek
Investments in properties
Other assets
Total assets
Up to
1 month
BD’ 000
1 to 3
months
BD’ 000
3 to 6
months
DBD’ 000
6 months
to 1 year
BD’ 000
1 to 3
years
BD’ 000
Over
3 years
BD’ 000
Total
BD’ 000
4,483
79,705
20,062
138
972
-
35,316
4,007
1,824
34,053
273
935
10,194
4,931
1,281
4,351
-
13,102
3,631
3,406
-
5,316
1,510
2,583
3,012
-
5,965
12,788
459
1,505
44,112
3,382
5,174
738
10,341
1,147
10,448
156,421
29,459
9,889
80,748
3,382
5,174
12,752
10,341
2,082
105,360
76,408
20,757
20,139
12,421
85,611
320,696
Liabilities, Unrestricted Investment Accounts and Equity
Customers’ current accounts
Other liabilities
Unrestricted investment accounts
Equity
47,345
3,562
159,996
-
3,613
-
2,460
-
25,014
-
4,157
-
2,641
71,908
47,345
3,562
197,881
71,908
Total liabilities, unrestricted
investment accounts and equity
210,903
3,613
2,460
25,014
4,157
74,549
320,696
Liquidity gap
(105,543)
72,795
18,297
(4,875)
8,264
11,062
-
Cumulative liquidity gap
(105,543)
(32,748)
(14,451)
(19,326)
(11,062)
-
-
42
Bahrain Islamic Bank
Annual report 2005
Notes to the Consolidated Financial Statements
31 December 2005
28. Liquidity Risk (continued)
The maturity profile of assets, liabilities, unrestricted investment accounts and equity at 31 December 2004 was as follows:
Up to
1 month
BD’ 000
1 to 3
months
BD’ 000
3 to 6
months
BD’ 000
6 months
to 1 year
BD’ 000
1 to 3
years
BD’ 000
Over
3 years
BD’ 000
Total
BD’ 000
Assets
Cash and balances with the
BMA and other banks
Murabaha receivables
Mudaraba investments
Musharaka investments
Non-trading investments
Investments in associates
Investments in Ijarah assets
Ijarah Muntahia Bittamleek
Investments in properties
Other assets
3,269
64,308
768
141
-
40,606
3,070
188
17,072
1,180
7,309
1,432
329
653
-
373
587
935
-
637
939
2,383
-
6,138
42,243
6,549
537
36,315
2,953
5,124
3,528
4,044
1,165
9,407
155,476
11,819
2,721
55,770
2,953
5,124
5,116
4,044
2,345
Total assets
68,486
62,116
9,723
1,895
3,959
108,596
254,775
Liabilities, Unrestricted Investment Accounts and Equity
Customers’ current accounts
Other liabilities
Unrestricted investment accounts
Equity
30,368
2,668
124,637
-
160
4,812
2,760
3,040
-
18,278
-
17,349
-
713
49,990
30,368
2,828
168,829
52,750
Total liabilities, unrestricted
investment accounts and equity
157,673
7,732
3,040
18,278
17,349
50,703
254,775
Liquidity gap
(89,187)
54,384
6,683
(16,383)
(13,390)
57,893
-
( 89,187)
(34,803)
(28,120)
(44,503)
(57,893)
-
-
Cumulative liquidity gap
43
Bahrain Islamic Bank
Annual report 2005
Notes to the Consolidated Financial Statements
31 December 2005
29. Segmental Information
The activities of the Group are performed on an integrated basis. Therefore, any segmentation of operating income, expenses, assets and liabilities is not
relevant. As such, operating income, expenses, assets and liabilities are not segmented.
The Group operates solely in the Kingdom of Bahrain and, as such, no geographical segment information is presented.
30. Fair Value of Financial Instruments
The estimated fair value of the Group’s financial instruments are not significantly different from their book values as at the consolidated balance sheet other
than unquoted equity shares as reported in note 7. The directors believe that these investments approximate fair value.
31. Earnings and Expenses Prohibited by Shari’a
The Group did not receive income or incur any expense prohibited by the Shari'a.
32. Social Responsibility
The Group discharges its social responsibilities through zakah and charity fund's expenditures and donations to good faith qard fund for marriage,
refurbishment, medical treatments, etc.
44
Bahrain Islamic Bank
Annual report 2005
Contacts and Information
Head Office
Bahrain Islamic Bank B.S.C.
Al Salam Tower
Diplomatic Area, Manama
P.O. Box 5240
Kingdom of Bahrain
Email
[email protected]
Telephone
General:
+973 1754 6111
+973 1754 6222
Fax:
+973 1753 5808
+973 1753 5707
Call Centre:
+973 1751 5151
Website
www.bisbonline.com
Treasury
Tel:
+973 1754 6183
Telex
9388 / 9390
BESMEH BN
Fax:
+973 1754 3486
Cable
Bank Islami
S.W.I.F.T.
BIBBBHBM
Key Contacts
Credit & Risk Management
Tel: +973 1754 6166
Fax: +973 1791 6166
[email protected]
Corporate &
Institutional Banking
Tel: +973 1751 5155
Fax: +973 1791 9155
[email protected]
Central Operations
Tel: +973 1754 6133
Fax: +973 1791 6133
[email protected]
Financial Control
Tel: +973 1754 6188
Fax: +973 1791 6188
[email protected]
Branches
Branch
Main Office
Manama
Muharraq
Gudaibiya
Riffa
Jidhafs
Isa Town
Sitra
Hidd
Al-Dana
Hamad Town
Budaiya
Tel
+973
+973
+973
+973
+973
+973
+973
+973
+973
+973
+973
+973
1754
1722
1734
1724
1777
1755
1768
1745
1735
1782
1741
1759
6222
3936
2796
5446
8362
3983
0044
8008
8555
8000
8111
8555
Fax
+973
+973
+973
+973
+973
+973
+973
+973
+973
+973
+973
+973
1753
1722
1734
1726
1777
1755
1768
1773
1746
1772
1741
1759
5656
3933
2795
2178
7510
3139
2289
7610
7030
0585
4533
2667
Human Resources & Services
Tel: +973 1754 6185
Fax: +973 1791 6185
[email protected]
Corporate Communication
Tel: +973 1751 5150
Fax: +973 1791 9150
[email protected]
Information Technology
Tel: +973 1754 6202
Fax: +973 1791 6202
[email protected]
Tel: +973 1754 6143
Fax: +973 1791 6143
[email protected]
Internal Audit
Tel: +973 1754 6163
Fax: +973 1791 6163
[email protected]
Treasury & Investment
Tel: +973 1754 6183
Fax: +973 1791 6183
[email protected]
Retail Banking
Tel: +973 1754 6161
Fax: +973 1791 6161
[email protected]
Internal Shariah Supervision
Tel: +973 1754 6153
Fax: +973 1791 6153
[email protected]
Board Secretariat
Tel: +973 1754 6128
Fax: +973 1791 6128
[email protected]