Arab African International Bank reports $156m net profit in H1 2024 – Dailynewsegypt
Arab African International Bank (AAIB) reported a net profit of $156m for the first half of 2024, according to a statement released by the bank.
This represents a significant increase in profitability for the bank, driven by a change in vision and strategy implemented in early 2023.
Tamer Waheed, Vice Chairperson and Managing Director of AAIB, attributed the strong performance to the efforts of the bank’s 3,000+ employees.
He highlighted the Arab African International Bank’s success in doubling local currency customer deposits to over EGP 280bn, up from EGP 130bn and increasing foreign currency customer deposits by more than 50% in less than 18 months.
“We not only doubled our local currency customer deposits to exceed EGP 280bn, up from EGP 130bn, and uplift our FCY customer deposits by more than “50%” in less than 18 months, but simultaneously, we steadily doubled AAIB’s net income generation momentum,” Waheed said.
Waheed acknowledged the impact of the global interest rate environment, which has boosted the banking sector’s net interest income but also increased the inherent risk of asset books. He stated that AAIB remained committed to responsibly managing this risk, elevating its expected credit loss (ECL) to $73m, a 2.4% cost of risk.
“Furthermore, as we recognize that the globally higher interest rate environment, despite its positive impact on the banking sectors reported net interest income, has also its toll on the inherent risk of bank’s assets books, we remained committed to responsibly and consciously elevating our ECL to reach $73m, a “2.4%“cost of risk as we continue to monitor market developments after a recent 800bps interest rate hike and corresponding FX movements. In parallel, we remain committed to prudently monitor and manage all our institutional risk metrics and strongly drive forward our sustainability, responsible banking, and financial inclusion agenda,” Waheed said.
The bank’s strong performance has placed it back into the double-digit zone of return on equity.
“As such, we concluded H1 2024 with a bottom line of $156m, returning Arab African International Bank comfortably back into the double-digit zone of return on equity,” Waheed added.
AAIB remains optimistic about its future prospects, citing improved macroeconomic conditions and bold monetary policy moves that have eased economic pressures. The bank remains cautiously optimistic, however, as it continues to monitor macroeconomic developments, global monetary easing, capital market responses, and geopolitical events.
“Finally, Arab African International Bank stands optimistic amid a much-enhanced macro-economic outlook post-Q1, 2024, bold monetary policy moves that unquestionably eased a serious economic outlook mounting since 2020; hence, AAIB remains confident to continue delivering a strong set of results during 2024 yet still cautiously monitors the interplay of macro-economic developments, expected global monetary easing, capital market responses, and last but not least, much impactful geopolitical developments,” Waheed said.