Bank Muscat Meets Q4 Forecasts With 42% Profit Hike
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Bank Muscat Meets Q4 Forecasts With 42% Profit Hike

Bank Muscat Meets Q4 Forecasts With 42% Profit Hike

Results were boosted by the $38.8 million payout from insurers after the bank was the victim of a major cyber fraud case.

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Bank Muscat, Oman’s largest lender, posted a 42 per cent increase in its fourth-quarter net profit on Wednesday, largely in-line with analysts’ estimates, after insurers agreed to indemnify the bank’s losses in a pre-paid card fraud case.

The bank made a quarterly profit of OMR49.7 million ($129.1 million) in the three months to Dec. 31 compared with OMR35 million in the corresponding period of 2012, according to Reuters calculations.

Four analysts polled by Reuters had, on average, estimated a fourth-quarter profit of OMR48.7 million.

Reuters calculated the net profit figure based on the bank’s previous financial results. It posted a net profit of OMR152.2 million for the full-year 2013, compared to OMR139.2 million in the previous year.

The results were boosted by the $38.8 million payout from insurers after the bank was the victim of one of the biggest cyber fraud cases in history – an event which had forced it to provision the amount in the first quarter, significantly impacting its earnings.

The bank said last month it would reverse the impairment in its full-year numbers following the payout.

The fraud targeted prepaid travel cards, which allow users to carry currencies abroad rather than using their debit or credit cards in foreign countries, which can be expensive.

Impairments for the final three-month period of 2013 stood at OMR24.1 million, Reuters calculated, taking them to OMR50.5 million for the full year. Quarterly provisions rose 42 per cent year-on-year while the annual amount fell 13 per cent.

The bank said it booked a OMR2.7 million impairment following the sale of its stake in an Indian securities firm through a share buyback.

Bank Muscat had said in November it had received board approval for the planned disposal of Mangal Keshav Securities Ltd, without giving a value for the sale.

Loans and advances rose 9.7 per cent year-on-year to OMR6.1 billion at the end of December compared to OMR5.6 billion at the same point of 2012, while deposits increased 5.9 per cent over the same timeframe to OMR5.7 billion.

The lending growth rate is higher than that for the wider market, with central bank data showing a 6.3 per cent year-on-year increase in November, the latest month for which figures are available.


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