Bank Islam Malaysia turns around with profits

Bank Islam Malaysia Berhad, the first Islamic bank in the country, returned to the black for the six months ending Dec. 31 last year, with a profit before zakat and tax of 165.8 million ringgit (47.37 million U.S. dollars) , the bank said Friday.

The profit represents a big improvement over the loss of 43.2 million ringgit (12.34 million U.S. dollars) reported in the corresponding period ended Dec. 31, 2005, the bank said in a press release.

Managing Director Zukri Samat attributed the sharp earnings recovery to the implementation of the bank's turnaround plan, which includes the implementation of strategic changes to grow new businesses and an aggressive loan recovery program.

"The effectiveness of these strategic changes has been amply demonstrated in the first half of our earnings. Forty percent of the 165.8 million ringgit (47.37 million U.S. dollars) profit came from operations, and the balance came from loan recoveries," he was quoted as saying in the press release.

The return to profitability after two years' of losses puts the bank back on track to capitalize on the incentives recently unveiled by the Malaysian government to accelerate and deepen the development of the Malaysian Islamic Financial Center, said Zukri.

He added the bank has formulated a Carve Out Plan to address legacy non-performing finances. The execution of this plan is expected to take place before the end of the financial year ending June 30, 2007.

Source: Xinhua