Reflecting Islamic finance’s continued surge in popularity in Oman, Bank Nizwa recorded its first net profit since inception in 2013. Witnessing unparalleled growth over the last four years, the bank has led the sector from the start, establishing a foundation for its continued traction among entrepreneurs, investors and the public from every segment in the Sultanate. Its success, underpinned by consistent innovation, has cemented tits role as the undisputed leader of Islamic finance in Oman.

Financial Milestones

During their recent Annual General Meeting, Sayyid Amjad bin Mohammed Al Busaidi, Chairman of the Bank Nizwa, presented the bank’s financial performance for the year ended December 2016. Additionally, shareholders approved the director’s report, the corporate governance report, the auditors’ report and all financial statements.

Sayyid Amjad commented during the meeting, “Bank Nizwa’s financial performance this year demonstrated solid growth throughout its operation, reinforcing its leadership position within the sector. Not only were we able to maintain our status as Oman’s fastest-growing Islamic financial institution, we also managed to grow the sector and secure major financial achievements. First and foremost, our assets grew by 49% to reach OMR 516 million whereas customer deposits increased by 86% to reach OMR 351 million, showing significant growth in the face of difficult economic circumstances. While our operating income for the year rose by 46%, our operating expenses declined by 3%, reflecting the success of our strategic cost management. As a result, cost to income ratio declined below 91%, allowing us to achieve our first record net profit.”

Despite growth in operations, the bank’s operating expenses were managed in line with income growth, thereby improving the headroom between cost and income growth. Its operating performance was underpinned by the strategic diversification of products and services. This allowed the Retail and Wholesale banking units to continue their strong performance throughout the year, boosting operating revenue to OMR 17.3 million, an increase of 46% on the previous year.

Sayyid Amjad added, “The bank’s customer financing portfolio, deposits, assets and operating income all reported substantial growth and as a result, we achieved a historic first net profit since our founding in 2013. During the year the Bank identified key opportunities, critical areas of improvement and subsequent tactical plans that helped retain its position as the largest full-fledged Islamic Bank in the Country.”

The Wholesale Banking Group was restructured in the year 2016, to further enhance the commitment of providing dedicated, tailor-made services for corporate clients. A dedicated team for corporate client services has been established to ensure speedy services, quick Turn Around Time (TAT) and interdepartmental coordination. In addition, the Project Finance & Syndication department merged with the team catering to large corporates to ensure synergy, efficient risk appraisals and coordination.

Raising Awareness

At the forefront of Bank Nizwa’s commitment to grow Islamic finance in Oman have been its consistent efforts to work with stakeholders to reach new audiences. In 2015, the bank launched the ‘Islamic Finance Knowledge Series’, a nationwide campaign that continues to empower local communities across Oman with knowledge of Islamic finance. The roadshow has visited various colleges and universities, including Sultan Qaboos University, Sohar University, and Shinas College of Technology among others. The bank has also used the campaign to reach out to government employees, sharing its expertise with public sector entities.

Determined to use its profile as the Sultanate’s leading Shari’a-compliant institution to inspire the next generation to live financially secure lifestyles, Bank Nizwa has also earned a reputation for sharing its expertise with undergraduates from some of the most prestigious international universities. The bank has welcomed dozens of visitors from the National University of Singapore, the University of Washington, and Paris Dauphin University in 2016 alone.
 
In addition, the bank has remained focused on bringing Islamic financial solutions to more local communities. Inspired by that drive, it introduced its first branch-on-wheels, which visited tens of cities across the country. The mobile branch brought its own team of experts, ATM, and a host of products and services to communities throughout the Governorates of Muscat, Al Dakhiliyah, Al Sharqiya, Dhofar, Al Batinah and Al Buraimi.

A Milestone Year

Since inception, Bank Nizwa’s exceptional levels of customer service have resulted in national, regional and international critical acclaim with 2016 proving to be no exception. The year saw the bank take its tally of accolades to 23 awards, earning the award for ‘Best Performing Islamic Bank in Oman’ for the second year in a row at the 23rd Annual World Islamic Banking Conference (WIBC), the ‘Islamic Bank of the Year’ by the leading Corporate Livewire Finance Awards, and the title of ‘Strongest Islamic Retail Bank’ in the Sultanate at the Islamic Retail Banking Awards among others.