Last checked at 17 Mar 2009 08:25
We refer to the recent share price movements of Bank Muscat and wish to inform the market about the following.
The bank's operating performance continues to be strong and profitable. However there are certain one-off items which we wish to highlight.
In line with our annual report disclosures in our chairman's statement we decided to sell our stake in HDFC Bank, India over a period of time. However the time and price realizations depend on market conditions. Till date the bank has disposed around 40% approximately of its stake and the gain on realizations will be reported in our first quarter results.
The bank continues to hold available for sale investments in its equity portfolio and it is anticipated that we could have RO 4 million to RO 7 million of losses in the first quarter results.
During the course of the year the bank will have to repeat the impairment test exercise it carried out last year for testing for any potential impairment in value on its Saudi Pak Bank investment. The carrying value of this investment as at December 31st 2008 was RO 17.9 million.
Our operations in BMI Bank Bahrain continue to be robust and the bank's capital adequacy is in excess of 20%. While the business conditions continue to be challenging BMI Bank is expected to post profits in its first quarter.