Market Movements 21-10-2019

Business Change Closing ptsJAPAN - Nikkei +56.22 22,548.90GERMANY - DAX +114.36 12,747.96FRANCE - CAC 40 +12.10 5,648.35EUROPE - Euro Stoxx 50 +20.67 3,600.08S. KOREA - KRX 100 +16.85 4,423.09PHILIPPINES - PSEi +5.90 7,891.13INDIA - Sensex +246.32 39,298.38

Change Closing ptsAUSTRALIA - All Ordinaries -0.70 6,757.66PAKISTAN - KSE 100 -785.42 33,084.73

KFH reports KD 190.5 mln net profi ts for 9 months; EPS 27.67 fi ls, a rise of 12.6%

Total operating income reaches KD 615.2 million, an increase of 4.3%

KUWAIT CITY, Oct 21: Chairman of Kuwait Fi-nance House (KFH) Hamad Abdulmohsen Al-Marzouq said that KFH has, by the grace of Allah, reported net profi ts of KD 190.5 million for the nine months end-ed Sept 30, 2019 for KFH shareholders compared to KD 169.1 million for the same period last year i.e. an increase of 12.7%.

Total fi nancing income increased for the nine months ended Sept 30, 2019 to reach KD 701.2 million, an increase of 10.2%.

Total operating income for the nine months ended Sept 30, 2019 reached KD 615.2 million, an increase of 4.3%; and net operating income reached KD 393 million, i.e. a growth of 7.0% com-pared to the same period last year.

Cost to income ratio dropped to reach 36.1% for the nine months ended Sept 30, 2019, compared to 37.7% for the same period last year.

Earnings per share for the nine months ended Sept 30, 2019 reached 27.67 fi ls, compared to 24.58 fi ls for the same period last year i.e. an increase of 12.6%.

Total assets increased by 6.9% com-

pared to the end of last year to reach KD 18.999 billion at the end of Q3 this year.

Finance receivables reached KD 9.356 billion, an increase of KD 167.7 million, i.e., a growth of 1.8% compared to end of last year.

Investment in Sukuk reached KD 2.132 billion, an increase of KD 568.6 million, i.e. a growth of 36.4% com-pared to end of last year and the majority of the balance represents investments in Sovereign Sukuk.

Depositors’ accounts reached KD 13.248 billion, i.e., an increase of KD 1.467 billion or 12.5% compared to the end of last year.

Growth SustainabilityAl-Marzouq said in a press release

that the double-digit growth in net prof-its and the bank’s positive fi nancial indicators are results of the successful growth sustainability strategy of fo-cusing on core banking activities and exiting non-strategic investments to im-prove asset quality.

He pointed out that KFH succeeded in raising total assets value, maintaining the highest possible quality standards and di-versity to limit risk and ensuring infl ows to enhance liquidity. This was refl ected in the ongoing increases in net income, backed by the increased operating income. All of the previous factors had a positive impact on net profi t and the compound an-nual growth rate (CAGR) which has lately been showing steady growth.

Al-Marzouq added that KFH seeks to

enhance the return on shareholders’ equity (ROE) and depositors’ accounts, while reaching the highest level of innovation and distinction in customer service. This is to be in line with the bank’s vision of leading international developments in Is-lamic fi nancial services.

Digital Transformation StrategyAl-Marzouq drew attention to the suc-

cess of the digital transformation strategy in the Group, pointing to a qualitative move in rolling out digital fi nancial solu-tions, such as the self-service banking ser-vices and the AI-enabled robotics. KFH also succeeded in enhancing security and data analyses, upgrading the infrastructure and e-service platforms in order to im-prove customer experience in accordance with the highest world standards.

He added that KFH aims to expand its operations in the Middle East and Eu-rope through the services of the “digi-tal bank” in Turkey and the “Jazeel”

platform in Bahrain, plus modern, so-phisticated and highly effi cient online services.

He stressed the ongoing KFH policy of investing in technology and adopt-ing the latest fi nancial technology tool “FinTech”, along with strengthening the innovation environment which has become a strategic factor in confront-ing the challenges of digitalization and adapting to fast-paced and competitive environment in the banking sector.

Al-Marzouq noted that KFH is on track of promoting synergy among the Group’s banks in Turkey, Malaysia, Bahrain and Germany which continued their outstanding performance in line with the strategies aimed to utilize the strength of the markets they operate in.

He went on to stress that KFH-Tur-key enjoys a strong fi nancial position with a very high liquidity levels as stipu-lated by Turkish and Kuwaiti regulatory requirements as well as Basel III stand-ards. In addition, Al-Marzouq pointed out that KFH-Turkey Capital Adequacy ratio and all fi nancial indicators exceed by far the rates required by the regula-tory bodies.

He credited that to the breadth of funding activities in Turkey, the diver-sity of KFH-Turkey portfolio, the high-quality assets and its size as the largest Islamic bank in the country.

Development Plan and Kuwait Vision 2035

Emphasizing the role of the private sec-

tor in the Kuwaiti economy, Al-Marzouq pointed out the leading role of KFH in supporting the local economy, fi nancing mega projects and supporting the National Development Plan. This is particularly part of Kuwait Vision 2035 to transform the country into a regional and global fi -nancial and commercial hub.

He said that “KFH has successfully fi nanced a large number of projects in various vital sectors, including energy, water, power, infrastructure and con-struction. It has a regional and global leading role in Sukuk issuances for local and international companies and gov-ernments. “

Meanwhile, he stressed the need to diversify sources of income and not to rely on oil as the only source of public fi nances.

Having a proven track record in sup-porting Small and Medium enterprises SMEs, Al-Marzouq praised KFH’s ef-forts to encourage the entrepreneurs and youth so that they can be materialized in the interest of society and economy. He added that KFH has established a department dedicated to fi nance such enterprises.

Credit RatingsAl-Marzouq said that KFH’s continu-

ous holding of the international rating agencies positive ratings confi rms its sound fi nancial position, adding that Moody’s affi rmed A1 / Prime-1 long- and short-term domestic and foreign currency deposit ratings of KFH. At the

same time, Moody’s upgraded KFH’s baseline credit assessment (BCA) to baa3. The outlook on KFH’s long-term ratings remains stable. Fitch Ratings also has affi rmed recently KFH`s Long-Term Issuer Default Rating (IDR) at ‘A+’, with a stable outlook. The rating agency also affi rmed the company’s Vi-ability Rating at ‘bb+’.

Best Bank in KuwaitKFH has won prestigious awards

from well-known international provid-ers, including the Euromoney ‘Best Bank in Kuwait’ award for 2019 and the Global Finance’s World Best Islamic Fi-nancial Institution award for 2019. The criteria and methodologies are used for these awards including but not limited to, customer needs, technological inno-vation, quality of products, reputation, customer satisfaction, geographic foot-print, strategic relationships, excellence and adapting to the changing market conditions. All these ratings are based on the advice of bankers, analysts and fi nancial experts from around the world.

Kuwaiti YouthAl-Marzouq said that “the recruit-

ment and development of Kuwaiti youth is ongoing strategy at KFH, which is supported by growth opportunities and a large market share. The organizational structure should be improved, proce-dures developed, and effective systems implemented to enhance the mechanism and effi ciency of work.

Mubadala to invest $250mn in technology Maroc Telecom reports flat Q3 profit

Abu Dhabi’s state fund Mubadala In-vestment Company plans to invest $250 million through two funds in tech-nology fi rms in the Middle East and North Africa, it said on Monday.

Abu Dhabi, capital of the United Arab Emirates, has set up a dedicated a hub to attract technology start-ups, called Hub71, and is encouraging other re-lated investments as part of its effort to diversify the economy away from oil revenues.

The latest investments include a

$150 million fund that will invest in oth-er technology funds and $100 million targeted directly at early-stage compa-nies, Ibrahim Ajami, head of Ventures at Mubadala Capital said.

“The MENA funds will drive the eco-nomic development of Abu Dhabi by stimulating tech investment activity,” Ajami told delegates at a Fintech event.

Under its $150 million fund, Mubada-la Capital will also invest in San Fran-cisco-based Data Collective Venture Capital, Middle East Ventures Partners

and Global Ventures.The $100 million fund will focus on

early stage tech companies that will be part of the Hub71 development. The fund aims to invest in a portfolio of 15 fi rms.

With offi ces in Abu Dhabi, London and San Francisco, Mubadala Ven-tures investments include a $15 billion investment in Softbank’s Vision Fund I. It manages the $400 million Mubadala Ventures Fund 1 in the United States and another $400 million fund in Eu-rope. (RTRS)

Maroc Telecom, Morocco’s largest tel-ecoms operator, reported on Monday an adjusted third quarter profi t of 1.625 bil-lion dirhams ($170 million), up 0.4% com-pared with the same period last year.

The adjusted profi t in the fi rst nine months to end September rose 1.3% year-on-year to 4.6 billion dirhams, thanks to higher mobile data revenue and cost control, the company said in a statement.

The third quarter’s consolidated rev-enue rose to 9.46 billion dirhams, up

1% compared with the same quarter last year, thanks to an improved performance on the Moroccan market.

Revenue for the fi rst nine months was up 0.9% to 27.3 billion dirhams.

Maroc Telecom operates subsidiar-ies in Benin, Burkina Faso, Ivory Coast, Gabon, Mali, Mauritania, Niger, Togo and the Central African Republic

The group’s customer base grew 10.6% to 67.6 million users, including 20.3 mil-lion in Morocco, by the end of September, it said. (RTRS)

Hamad Al-Marzouq, KFH Chairman.