SICO BSC (c), licensed as a conventional wholesale bank by the Central Bank of Bahrain “CBB”, announced today its consolidated results for the fourth quarter and year ended 31 December 2020.
SICO’s consolidated net profit for the fourth quarter was BD 1.2 million, a decrease of 49% year-on-year from the BD 2.5 million for the same quarter in 2019. Earnings per share (EPS) for the quarter were 3.37 Bahraini fils, compared to 6.65 Bahraini fils in the fourth quarter of 2019. Total comprehensive income for the fourth quarter of 2020 amounted to BD 1.7 million, a decrease of 38% from the BD 2.8 million recorded in the same quarter of 2019. The decline in consolidated net profit for the fourth quarter 2020 compared to the same quarter is 2019 is attributed to lower performance fees for assets under management as a result of the COVID-19 pandemic.
SICO recorded a consolidated net profit of BD 3.0 million for the full year 2020, a decrease of 51% from the BD 6.0 million recorded at year-end 2019. EPS for the year were 8.0 Bahraini fils, compared to 16.32 Bahraini fils at the end of 2019. SICO’s total comprehensive income for 2020 came in at BD 2.9 million, a decrease of 57% from the BD 6.8 million posted at year-end 2019.
Total shareholders’ equity amounted to BD 58.3 million as at 31 December 2020, declining by a slight 2% year-on-year from the BD 59.4 million recorded for 31 December 2019.
SICO’s total assets of BD 181.8 million at year-end 2020, up by 9% from the BD 166.8 million recorded at the close of 2019.
SICO’s Board of Directors has recommended a cash dividend of 5% of the share capital, equivalent to 5 Bahraini fils per share and subject to the approval of the Central Bank of Bahrain and the General Assembly.
The external auditors, KPMG, have issued an unqualified opinion on the financial statements for the year ended 31 December 2020.
Overall, the bank’s financial performance in 2020 was impacted by the COVID-19 pandemic-related economic shock and the extreme volatility resulting from oil prices fluctuations and their impact on the market valuation of regional securities.
Adverse market conditions took a toll on SICO’s net investment income, which recorded BD 2.2 million for 2020, a decrease of 48% from the BD 4.3 million recorded for the previous year. However, net investment income posted improved results in the second half of the year backed by the steady recovery in capital markets.
Net fee income for 2020 amounted to BD 3.6 million, a 42% year-on-year decline compared to the BD 6.3 million recorded in 2019. The decline is attributed to lower performance fees in 2020 due to challenging market conditions which affected the performance of assets under management in comparison to the previous year.
Brokerage and other income recorded BD 3.2 million in 2020, growing by 35% from the BD 2.4 million achieved in the previous year. The bank saw significant growth from its global and regional brokerage activities, with the division demonstrating strong resilience and an ability to broaden its client base and attract new retail and institutional clients, leveraging its multiple digital trading platforms.
Net other interest income experienced growth of 3% in 2020 as compared to the previous year. This is due to SICO’s ability to sustain business activities as well as the deployment of efficient strategies for offering collateralized lending and effective utilization of liquid assets. The bank’s prudent and conservative credit risk management strategy enabled it to carry out its functions without taking additional provisions.
Total assets under management (AUMs) stood at BD 877.9 million (USD 2.3 billion) as of 31 December 2020, increasing by 9% from the BD 808.7 million (USD 2.1 billion) recorded at year-end 2019, driven by new clients mandates and the asset management team’s strong performance as well as continued market stability and improvement across the region during the second half of the year.
Assets under custody with the Bank’s wholly owned subsidiary, SICO Funds Services Company (SFS), stood at BD 3.0 billion (USD 8 billion) at 31 December 2020, growing by 7% year-on-year from the BD 2.8 billion (USD 7.4 billion) at the end of 2019.
Commenting on SICO’s performance for 2020, Chairman of the Board Shaikh Abdulla bin Khalifa Al Khalifa said: “SICO demonstrated outstanding resilience in the face of a turbulent year, with the robustness of our business model and our team’s talents and capabilities proving equal to the challenge. Additionally, we have made progress on our expansion and growth strategy, having acquired a majority stake in Bank Muscat’s Saudi-based subsidiary, Muscat Capital. This should allow us to offer full-fledged services in the Kingdom and to further enhancing our ability to meet clients’ investment needs and marking a milestone in our achievements.”
We would like to express our gratitude and appreciation to the government of the Kingdom of Bahrain for their wise leadership and direction and for the role of the Crown Prince Prime Minister in quickly enacting measures to contain the COVID-19 pandemic and supporting initiatives to sustain the economy of our beloved kingdom.”
Chief Executive Officer Ms. Najla Al-Shirawi further added: “SICO has continuously demonstrated the strength of its operations as well as its ability to adapt to unforeseen conditions in order to continue delivering value to its stakeholders. In spite of the resounding impact of closures on businesses across the globe as well as market and oil price fluctuations negatively affecting our business, SICO was still able to deliver positive results and generate value for our shareholders. At our asset management business, our total AUMs grew by 9% from the value booked at the end of 2019. Additionally, SICO’s signature equity funds continued to outperform their benchmarks. On the investment banking front, we maintained our upward trajectory, gaining several key mandates, while cementing the bank’s position as a leading provider of value-added services and innovative advisory solutions. Meanwhile, SICO’s brokerage operation also continued to grow, with its fixed income business posting outstanding results during the year, reaching transaction volumes of USD 1.4 billion. The division has retained its status as Bahrain’s leading broker for 22 consecutive years, with a total market share of 56% for 2020. Our Abu Dhabi-based brokerage subsidiary SICO Financial Brokerage witnessed its most profitable year to date. We are proud of the achievements we have made throughout the year and our ability to ensure business continuity and meet our clients’ evolving needs in the face of the unfolding crisis, all while safeguarding the health and safety of our employees.”
SICO is listed on Bahrain Bourse (“BHB”) and its code is SICO-C. The press release and full set of financial statements are available on BHB website.
