Al Ahli Bank set for profits fall

AL AHLI BANK: Tough times ahead for Kuwait's fifth largest bank. (Getty Images)

Al Ahli Bank of Kuwait, the country's fifth-largest lender by market value, will see its 2008 net profit fall between 10 percent and 15 percent due to provisions, and expects 2009 to be "tough", a senior bank official said on Sunday.

Deputy Chief General Manager Abdulla Alsumait also said the bank has shelved plans to increase its capital, which was meant for an expansion, due to the global crisis.

"We will see a drop in 2008 net profit because of provisions. It will not be more than 10 to 15 percent," he said at the opening of a new branch in Abu Dhabi.

In 2007, the bank made 76 million dinars, its website said.

"Because of the crisis, the Central Bank of Kuwait is more cautious and has directed all banks to take extra provisions," he said, declining to give figures.

He said this year will be a "tough" year and the bank's strategy is to control costs and curb its expansion plans.

Al Ahli, capitalized at 109 million dinars, had secured approvals to increase its capital by 20 percent last year.

"The increase was for aggressive expansion and we don't need that now because we will focus on reducing costs to achieve our targets," he said.

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