Muscat: Capital Intelligence (CI), the international credit rating agency, has reaffirmed Bank Sohar's Financial Strength Rating (FSR) at 'BBB'. In their recent report, CI outlined the bank's good asset quality, strong internal capital generation and sustained good growth of both operating and net profit over the past few years and in first quarter 2014.
Commenting on achieving the BBB rating from Capital Intelligence, Dr Mohamed Abdulaziz Kalmoor, CEO of Bank Sohar said; "The reaffirmation of Bank Sohar's rating by CI is a clear expression of confidence by the international rating agency in the Sultanate's economy and the banking sector in general. It is also an endorsement of the bank's increasing financial strength and sound business strategies; in particular, highlighting its good asset quality and commitment to achieve excellence in all aspects of its operations."
CI also mentioned that the bank's overall financial profile remains sound, and together with the positive economic prospects for Oman, Bank Sohar's Foreign Currency Ratings (FCR) are affirmed at 'BBB+' Long-Term and 'A3' Short-Term. The Support Rating is maintained at '2' in view of the sizeable combined ownership of the government and reflects the high likelihood of support in case of need. The Outlook for all the ratings is 'Stable'.
Bank Sohar has built up a strong balance sheet and market share since its inception in 2007 and is currently ranked as the fourth largest bank in Oman and is also considered to be the most profitable bank in Oman. This position was maintained at end 2013 and second quarter 2014.
In fact, for the second quarter ending June 30, 2014, the bank's net profit catapulted by 35.13 per cent to OMR16.15 million compared to OMR11.95mn in second quarter 2013. The operating profit increased by 26.88 per cent to OMR35.27 million in second quarter 2014 compared to OMR27.80 million in second quarter 2013.
The bank's total assets grew from OMR1.745 billion in 2013 to OMR1.900 billion in the same period this year, a growth of 8.89 per cent. Net loans and advances grew by 16.47 per cent to OMR1.372 billion in comparison to OMR1.178 billion in 2013. The Bank's deposits which stood at MR1.351 billion by the end of June 2014 witnessing a growth of 8.11 per cent over last year.
The total shareholder equity increased to OMR181.85 million, an increase of 17.59 per cent over the previous year. Operating expenses went up by 13.82 per cent to OMR14.98 million, in comparison to OMR13.16 million in the same period last year. Despite the increase in expenses, the Cost to Income Ratio has reduced from 47.35 per cent in 2013 to 42.48 per cent this year.
This rating comes shortly on the heels of a similar affirmation from Fitch Ratings, another international credit rating agency. Fitch had also re-affirmed Bank Sohar's ratings and made a note of the sound asset quality and strong liquidity ratios.
As a testament to its success and strength within Oman's banking sector, Bank Sohar has won a slew of awards locally, regionally, and internationally in just the first six months of 2014.
Among its accolades, the Bank and Dr Kalmoor were received the 'Best Financial Brand Oman 2014' and 'Best Banking CEO Oman 2014' award respectively by renowned UK based Global Brands Magazine and also received 'The Diamond Eye Award for Quality, Commitment & Excellence' from the French based Otherways Management & Consulting Association.
Bank Sohar was also presented with the 'Strategic Award' for their corporate website (www.banksohar.net) from the Lebanon based Pan Arab Excellence Awards Academy as well as Oman Web Awards. Bank Sohar was also named the 'Fastest Growing Bank in Oman 2014' while Dr Kalmoor received the 'Outstanding Contribution to Banking Industry Oman 2014' Award by UK based International Finance Magazine (IFM).
In addition, Dr Mohamed Abdulaziz Kalmoor, has also received the 'Most Outstanding Corporate Leader' award while Bank Sohar was also recognised as one of the 'Top 5 Large Corporate Enterprises in the Sultanate' for the third consecutive year at the Alam Al Iktisad Wal Amaal (AIWA) Awards. Bank Sohar was also recently recognised as the Bank with the 'Best Customer Service– Retail Banking', 'Best Cash Management' and 'Best Corporate Card' by Dubai based CPI financial.