The General Assemble of Bank of Palestine approves the distribution of profits in the amount of $25.3 million on shareholders
8 | 4 | 2017
On Thursday, 6 April 2017, the General Assembly of Bank of Palestine held its ordinary annual meeting at the bank's main headquarters in Ramallah, along with a videoconference with the Roots Hotel in Gaza. The meeting was attended by Mr. Hashim Al Shawa, Chairman and General Director of Bank of Palestine, members of the Board of Directors and company controllers from the Ministry of Economy, Mr. Ahmad Aweidah, the Chief Executive Officer of the Palestine Exchange (PEX), Mr. Barraq Al Nabulsi, the Executive Director of the Palestine Capital Market Authority, representative from the external auditor's company, and several shareholders, employees, economists and businessmen.
The work agenda of the annual ordinary meeting of the General Assembly included: considering and approving the report of the Board of Directors; considering and approving the financial data for 2016; demonstrating the recommendations of the Board of Directors regarding the distribution of profits on shareholders; approving the auditors' report; and absolving the Board of Directors from its responsibility. The assembly was held in the presence of a majority of 68% of shareholders.
In his opening speech, Mr. Hashim Al Shawa demonstrated a series of successes achieved by the bank, pointing out that financial results for 2016 revealed distinguished growth rates whereby net profits grew by 23% to reach $53 million, compared with $43.1 million during 2015. Bank assets increased to reach around $4.1 billion at a growth rate of 48% compared with $2.7 billion recorded at the end of December 2015.
Al Shawa added that total income increased by 30% to reach $177.4 million, compared with $136.7 million during 2015, and client deposits also increase by 40% to reach $3.1 billion, compared with $2.2 billion recorded by the end of December 2015. Also, the credit portfolio recorded $2.2 billion at a growth rate of approximately 60%, compared with $1.3 billion recorded by the end of 2015.
Al Shawa also stated that the bank was able to reinforce its standing in the Palestinian banking market last year as the largest banking institution in Palestine that is committed to state-of-the-art banking services and transactions that are deeply rooted in established values, allowing it to yield profitable returns for all its customers from shareholders, clients, employees and suppliers from all sectors of Palestinian society. He pointed out that the consolidated financial results for 2016 bore the fruits for achieving the strategy of natural growth in performance indicators, particularly those concerned with the development of the credit portfolio for major projects in the housing sector and lending programs for small and medium size enterprise, part of the financial inclusion plan. At the same time, the aforementioned consolidated financial results indicate the confidence of depositors in the bank, and are a direct outcome of the expansion policy within branches and electronic services, and a result of a sustainable strategy that depends on the concept of sustainability and the variety of income sources from subsidiary and partners companies. Al Shawa noted that the bank’s purchase of an additional share in the Arab Islamic Bank and the merger with the Commercial Bank had a good impact on the overall financial results of the previous year.
Al Shawa also talked about the bank’s huge interest in Palestinian women through the creation of Felestineya program that aims to empower and support women to contribute to economic growth and social development. Last year, the bank launched collateral free loans for small project owners and the Felestineya gold loans. It also provided banking awareness workshops and various training programs to women entrepreneurs, involving the participation of 1,300 women during 2016.
On keeping up with advancements in technology, Al Shawa pointed out that Bank of Palestine achieved a qualitative transition towards automation and electronic services, whereby its most prominent achievement during 2016 was the launch of an updated version of internet banking and the Banki application for banking services on smart phones, which increased electronic banking operations conducted by clients instead of being implemented at the bank branches.
On the international level, Al Shawa expressed his enthusiasm about the bank’s official launch of the first representative office outside Palestine at the Dubai International Financial Center in the United Arab Emirates during the second quarter of 2016, whereby a number of consulting and investment services were launched for Palestinian investors living in the Arab Gulf. This is considered an important step for networking and building bridges of communication with Palestinians in the Diaspora, and facilitating their links with Palestine. Al Shawa pointed out that the bank intends to continue its journey to expand and reach Palestinians all around the world, and further expansion will take place during 2017 where the bank will open its second representative office in Santiago, the capital of Chile, to establish links between the Palestinian communities in Latin America, Palestine and the Arab World.
Concerning subsidiary companies, Al Shawa clarified that Pal Pay for electronic payment services was able to promote its services in the Palestinian market. Pal Pay’s dealings and electronic payment transactions increased in the local market in comparison with last year. During 2016, new service contracts were signed with local and foreign entities in the field of providing electronic payment requirements and electronic vouchers to facilitate the implementation of programs. Al Wasata Securities also contributed to the promotion of its standing in the financial market and managing investing portfolios. The company supervises the management of shares estimated at half a billion dollars traded in the Palestinian Stock Exchange and other markets in the Arab World. Furthermore, the Arab Islamic Bank recorded significant growth in its operating indicators over the last five years, and Bank of Palestine is looking forward to promoting its services in the field of Islamic banking through expansion plans and increasing its capital to be able to hold market standing and enjoy the desired leadership in Islamic banking.
On the level of international recognition, the Banker Magazine granted Bank of Palestine the Best Bank in the World Award for Financial Inclusion in recognition of efforts conducted in the field of financial inclusion of Palestinian women and providing electronic solutions to citizens, especially those who fall outside the banking system, which is the very first initiative of its kind to be implemented in the Arab World.
One of the main points addressed by Al Shawa during the meeting of the General Assembly was the bank’s attainment of the necessary licenses to open its first branch in Dahiyet Al Bareed, in Jerusalem. This step forms part of the bank’s plans and efforts to reach Palestinians who fall outside the boundaries of banking services, and who represent approximately 60% of Palestinian society.
Al Shawa expressed his appreciation towards shareholders who put their trust and money to invest in Bank of Palestine, hoping that the year 2017 would be a good year for all Palestinians in terms of achieving national unity and the establishment of a Palestinian State with Jerusalem as its capital.
During the course of the meeting, the ordinary General Assembly approved the distribution of shares proposed by the Board of Directors in the amount of $25,351,129 (13% of paid capital) on shareholders registered at the Palestine Exchange in the following manner: $20,359,814 in cash (10.44% of paid capital) and $4,991,315 as free shares (2.56% of paid capital). Based on that, the bank’s capital increases from $195 million to $200 million, and the bank maintains its standing as the largest banking company in Palestine in terms of capital. The bank will also be able to promote its banking resilience and financial standing. The distribution of cash dividends on shareholders will begin on Sunday, 6 April 2017, and profits on shares will be distributed after the completion of legal procedures at the concerned departments.
After responding to the inputs of shareholders, the General Assembly approved the remaining items related to the reports submitted by the Board of Directors and the external auditors Ernst and Young, and delegated the Board of Directors to determine the contractual terms with the auditors for the year 2017. The General Assembly was closed by absolving the Chairman and members of the Board of Directors of their responsibility for the year 2016.