Al Baraka Bank-Egypt’s financing portfolio rose to EGP 10.2bn at the end of June, marking an increase of approximately 7.8% compared to June 2014, according to a report by Beltone Financial’s research department.
In the report, of which Daily News Egypt obtained a copy, Beltone Financial said the bank’s limited capital may restrict its ability to continue growth at the same pace. The report added that it may also check the bank’s ability to absorb possible crises regarding losses of assets, which has witnessed some volatility over the past few years.
Al Baraka Bank’s results also revealed the high volume of deposits at the bank, which rose by 5.1% in June, compared to the first quarter (Q1) of 2015, to a record EGP 21.4bn.
Beltone expects the bank will achieve a cumulative annual growth rate of 13% in terms of financing over the next six years, and a 10% growth of deposits.
The bank’s profits rose in Q2 of 2015 to a record of EGP 76.9m, an increase of 37%, compared to the same period in 2014. Beltone expects the bank would achieve a profit of EGP 65m by the end of the first half (H1) of this year.
In its report, Beltone indicated the stability of Al Baraka Bank-Egypt’s capital structure during Q2 of this year. The capital adequacy ratio reached 11.7%, compared to 11.1% in June 2014, and the core capital adequacy ratio rose to 9.4% from 9.2 % in March, and 8.7% in June 2014.
The bank’s non-performing assets remain high, at 6.68% at the end of June, compared to 6.74% in March. The provisions corresponding to those non-performing assets increased to 108.3% in June, compared to 101.7% in March, Beltone added.
Beltone expects a gradual improvement in asset quality during the upcoming period, as the bank is working to increase its financing portfolio. Beltone also expects that the non-performing loan rate will gradually improve to 5.5%.
