Net profit of Jordan's Housing Bank down 34% to JD66.6m in 2009

Jordan's Housing Bank for Trade and Finance's 2009 net profit fell 34 per cent to JD66.6 million ($93.9m /Dh344.8m) despite six per cent growth in income as the bank took provisions, unaudited results showed.

The financial statements, which still need approval from the Central Bank of Jordan, also showed the bank, the country's second-largest lender, saw a 12 per cent rise in its assets at the end of December 2009 to JD6bn compared with the same period in 2008.

Gross income rose six per cent to JD260m compared to the same period of 2008, while deposits rose 16 per cent to JD4.7 billon at the end of 2009 compared with the previous year.

Housing Bank was hit along with other Jordanian banks by the global financial crisis and last year began putting aside hefty provisions for non-performing loans, which stood at JD68m in June 2009.

Bank officials say its lower profitability reflected a conservative policy to built provisions even if there was sufficient collateral, since such provisions revert back to profits in the event they are not used under Jordanian law.

Most Jordanian banks are setting aside higher provisions to cover possible defaults and non-performing loans by businesses and real-estate firms reeling from the impact of the global downturn on the aid-dependent economy.

After provisions, Housing Bank's total outstanding loan portfolio, which includes credit to government bodies, rose 1.2 per cent to JD2.3bn at the end of 2009 from the same period in 2008, the statement obtained by Reuters said.

Housing Bank is one of the few Jordanian banks active in international financial markets, in an otherwise family-dominated banking scene.

The bank has a presence in Syria, the Palestinian territories and Algeria, where it has a joint venture bank, and a branch in Bahrain. It also has representative offices in the UAE, Iraq and Libya.

Housing Bank's main shareholders are Qatar National Bank with more than 35 per cent, followed by Libya's Foreign Bank with a 15 per cent shareholding and Kuwait's Real Estate Investment Consortium with a stake of more than 10 per cent.

 

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