2011 was a difficult year; the banking sector was cautious in its lending policies and continued to take additional provisions against   non-performing loans ( NPL ) that were caused by the ongoing economic crisis. 

Financial Performance

In 2011 , HBTF achieved good financial results. Pretax net profit grew by 16.6% to JD135.7 million (US$191.4 million) whereas after tax net profit grew by 13.1% to JD100 million (US$141 million), and gross income grew by 13.9% to JD300.7 million (US$ 424.1 million). The Bank was able to achieve these results after providing JD46 million (US$65.4 million) against NPL.

A review of our balance sheet shows the strong and sound financial position of the Bank. Total assets increased to JD6.9 billion (US$9.8 billion), total equity grew to JD1.05 billion (US$1.5 billion), customer deposits increased to JD4.8 billion (US$6.8 billion) and net credit portfolio grew to JD2.5 billion (US$3.5 billion). This growth was achieved despite the drop in customer deposits and credit facilities at our Syria subsidiary The International Bank for Trade and Finance (IBTF).

Key Performance

HBTF’s performance reflected positively on the financial indicators. Capital Adequacy ratio stood at 20.7% (Central Bank of Jordan’s minimum requirement is 12% and BIS Tier 1 capital minimum is 8%), deposit to loan ratio amounted to 51%, return on assets 1.5%, return on equity 9.7% and cost to income ratio was 38.6% (one of the best in Jordan’s banking sector).

Based on this performance, The Banker magazine awarded HBTF, Jordan’s “Bank of the Year” in 2011.

Market Share in Jordan

Two new branches were opened in 2011, bringing the number of branches to 112. HBTF has the largest branch and ATM networks in Jordan.

HBTF has a sizable market share of VISA credit and VISA electron cards. The bank has the largest market share of savings accounts (41.6%) and the second largest market share of total assets (15.1%), deposits (15.9%) and credit facilities (11.9%).

International Subsidiaries’ Performance

Despite the uncertainty in the regional and global economic environments, HBTF’s branches in Palestine and Bahrain, and subsidiaries in Syria, Algeria and the UK achieved good results.

Representative offices in Iraq, Libya and UAE continued their marketing role which resulted in enhancing relations with banks and customers.

Based on the good results achieved, the Board of Directors will recommend to the Shareholders’ Ordinary General Assembly a dividend of 25% of the nominal share value.

Governance

The Bank is committed to the principles of its Corporate Governance Convention, which is based on the Corporate Governance Guidelines issued by the Central Bank of Jordan and Jordan Securities Commission.

Corporate Social Responsibility

We are proud of our social responsibility initiatives. In 2011, we supported and donated to a number of healthcare, educational, cultural, art, social, humanitarian, sport and environmental entities. We also sponsored and supported scientific and intellectual events that service and help develop local communities.

The Year Ahead

The Bank adopted an ambitious Business Plan for 2012.  It focuses on achieving acceptable business growth, increased market share, and implementing prudent credit and investment policies based on prudent risk management , best market practices and Basel II regulations.  

Gratitude

I would like to seize this opportunity to thank the Central Bank of Jordan for their support of the banking sector and Jordan Securities Commission for their role in managing the capital market. 

I would also like to thank our shareholders, our customers , members of the Board, and the Bank’s staff and management team for their commitment to the Bank.

May God bless and protect Jordan under the leadership of His Majesty King Abdullah II.