|Arab Bank distributes JD89m in dividends
|The General Assembly of Arab Bank held its ordinary and extraordinary sessions on March 30, presided over by Chairman of Board of Directors Abdel Hamid Shoman, with the attendance of the bank’s board members and Companies General Comptroller, Dr Mahmoud Ababneh, who announced the legality of both sessions, as 72 percent of the shareholders were present.
The Assembly endorsed the bank’s financial statement for the year 2006, in which the bank made the highest net profit in its history of JD263.3 million, up JD63.2 million over 2005, with a growth of 31.6 percent.
The assembly also approved the amendment of the bank’s Articles of Association, to be in line with Jordan Companies law No.22, for the year 1997, and other related laws.
The General Assembly approved the recommendation of Arab Bank Board of Directors to distribute cash dividends of JD89.0 million which represents 25 percent of the shares nominal value, compared to last year’s JD53.4 million at 15 percent; this represents a growth in profit of 66.7 percent over 2005, equivalent to JD35.6 million.
The Arab Banking Group’s profit reached $624.6 million, compared to $503.2 million for the year 2005, a rise of 24.1 percent.
Shoman said the record profit achieved by Arab Bank during last year was a result of the strategy implemented by the bank’s management in all its banking activities, reiterating the bank’s ability to deal with the economic changes.
Shoman stressed that the main financial indicators of Arab Bank showed continuous growth, with shareholders equity rising to JD3,093.9 million compared to JD1,859.6 in 2005, representing 66.4 percent, while those of Arab Bank Group rose by 51.5 percent from $3,885.0 million in 2005 to $5,884.6 million in 2006.
Shoman said that the financial statement as of December 31, 2006 shows the bank’s success in increasing the loans and credit facilities markets. Shoman said that “the bank’s performance in 2006 is rewarding, by all measures, specifically its profitability, and its market share. As for the bank’s share price in Amman Stock Exchange, it fluctuates according to supply and demand in addition to other variables. When considering Arab bourses in general and Amman’s in particular, we find that the drop in Arab Bank’s share price was less than the drop of other price indicators, which reflects the trust in the Arab Bank and its continuous growth”, Shoman added.
As for the negotiations with the Gulf strategic partner, Shoman said, “We entered into negotiations with Emaar Company from the UAE for the sale of 10 percent of the bank’s shares. Emaar has large projects in countries where Arab Bank operates, which would reflect positively on the bank’s activities. However differences on the share sale price put a stop to the deal, as we consider JD35 for Arab Bank share, to be a fair price.
Arab Bank Chief Financial Officer, Dr Farouq El-Kharouf, said that the revenues from the sale of the bank’s treasury shares would be added to shareholders’ equity in line with established rules.
Regarding Arab Bank entry into new markets such as the acquisition of 50 percent capital in the Turkish MNG bank, and the establishment of Europe Arab Bank, Shoman said that the latter is a major step towards facilitating trade activities with EU countries, which is one of the largest trading partners with the Middle East countries. He added, “Our investment in MNG Bank in Turkey, which plays a strategic role in the region and is considered as the Middle East gateway to Europe, would facilitate the exchange of business activities with EU countries.
Shoman concluded, “As for listing Arab Bank shares in Abu-Dhabi stock exchange, agreement has already been reached last year and trading in Arab Bank shares would start soon.”
Dr Mahmoud Ababneh pointed out that amendment to the articles of association was made in accordance with the Jordan companies’ laws, and the bank’s profits were validated. He commended Arab Bank as a role model for others by showing its social responsibility as it has allocated 2 percent of its shares, (equivalent to 3,520,000 shares) at low rate for Jordan Armed Forces, in addition to valuable social and cultural activities which are carried out by Abdul Hamid Shoman Foundation as a center for scientific research and sponsor of scholars in various fields.