Kuwait Finance House (KFH) general assembly for the fiscal year ending December 31, 2014 approved the recommendations of the Board of Directors to distribute cash dividends by 15% of the par value of the share (equivalent to 15 fils per share) and bonus shares by 10% (equivalent to 10 fils per 100 shares). This applies to shareholders registered on the day of holding the extraordinary general assembly. Moreover, the general assembly approved all the points on the agenda.

Hamad Abdulmohsen Al-Marzouq, KFH Chairman, stated during the assembly that the year 2014 marked a turning point for KFH. The year began with the election of a new experienced, qualified and well-rounded Board of Directors. Towards the end of the year a new CEO was appointed having solid banking knowledge and vast banking experience. This was followed by the revamping of senior management positions in order to build a team capable of facing the challenges in the market and to deliver future growth. The restructuring of these positions will also help us develop sustainable performance according to the best international credit and investment practices. This coincides with the restructuring of investment portfolios in order to align them with our business strategy and ultimately drive profitability.

Moreover this has been reflected in the acceleration of the Bank’s progress through the enhancement of our abilities in all fields particularly in human resources, as we view our staff to be the key strategic asset. Increasingly we regard the expansion of our scope in local and international markets as well as the modernization, development and the launching of the new and innovative banking products, as the keys to our success. For that to materialize customer satisfaction has been and will be an even stronger thrust that we put in everything we do.

We will mark 2014 as an exceptional year and a turning point in the Bank’s progression towards achieving its strategic vision as a leading financial institution in the local market as well in the region. This can be seen through the improvement in operating efficiencies, cost rationalization and creation of new banking tools and products. This will enable us to meet our clients’ expectations and needs at the highest standards of quality and governance. Although most of the change initiatives took place in the second and third quarters of this year, the positive results of such initiatives started to emerge earlier with an overall excellent performance for 2014.

The Bank’s net income level rose to a record level as we, with the help of Allah, achieved a net profit that reached KD 126.5 million by the end of the year 2014 with a profit per share of 29.68 fils. The total assets reached KD 17.2 billion, an increase of 12.4% and the client deposits increased by 14% reaching KD 14.3 billion compared to KD 12.6 billion last year. These figures reflect the strong financial position of the Bank in a difficult period that hit the local and global economy. During such period, the Group sought to keep its assets and the essence of KFH reaching the best financial results.

In view of these financial results, the Board proposed payment of cash dividends of 15% and distribution of bonus shares of 10%.

We continue to work in an environment of changing economic and regulatory conditions in addition to unprecedented regional and global political developments. We have taken upon ourselves at an early stage to develop our businesses to face the future with a strategic vision to become the world leader in the Islamic banking industry. In 2014, we enhanced this prestigious position exceeding our capital position as approved by the Central Bank of Kuwait. This falls within the framework of Basel III, which sets the capital requirements and will be implemented over phases that would end by 2018. The Bank’s capital adequacy ratio reached 16.25%; a high ratio according to regional and international standards. We also sought to develop and improve credit risk management, settle the debts of insolvent companies and adopt measures to face any potential failure of repayment.

The continuous deployment of KFH’s expertise coupled with the accelerated coordination between the different departments allowed us to benefit from all available opportunities in 2014. We were able to expand our branch network, enhance our infrastructure, launch new products and develop electronic service channels to increase the level of satisfaction of our clients inside and outside Kuwait. With the grace of Allah, we were able to achieve exceptional profits from the largest real estate event in Kuwait in 2014 through the auction of the KFH Real Estate Portfolio where 68 properties were sold with a total value of KD 125.58 million. The bank’s share of profit from this was KD 36 million.

This year has been a pivotal year for the integration among the units of KFH Group, the restructuring of its investments and deepening the regional expansion. These enhancements will be adopted over the next few years through the implementation of policies aimed at our ambitious expansion plans and improving the Bank’s market position in local, regional and world markets. Our banking subsidiary in Turkey, Kuveyt Turk Participation Bank, for example, has expanded its network of branches to reach 300 branches across the country. The bank in Turkey achieved very high results in addition to the improved profitability in KFH Bahrain and KFH Malaysia. Moreover, we participated in the issuance of the first sovereign Sukuk for the Government of the Republic of South Africa valued at USD 500 million and the issuance of USD 1.6 billion short-term Sukuk in collaboration with international banks and the International Islamic Liquidity Management Corporation (IILM).

The strengths of KFH were reflected in maintaining its credit rating of (A+) by Standard & Poor’s and Fitch. In addition, Standard & Poor’s improved the ratings outlook of KFH from negative to stable. In 2014, KFH received many prominent awards in the banking sector including the award of the Best Islamic Bank in the Middle East, the Best Islamic Bank in Kuwait and the Best Bank in Kuwait.

With full confidence we could say that our 2014 results strongly reflect our potential and what we can achieve in the future having a strategy aimed at meeting the needs of all our shareholders, customers and employees. We are waiting to reap the fruits of the major reforms which were taken at the organizational and operational levels and which constitute a key element that will aid our efforts to achieve our objective of maintaining the market leadership position.

In conclusion, on behalf of the Honorable Board members, I would like to express the highest gratitude and appreciation to His Highness the Amir of the State of Kuwait, Sheikh Sabah Al-Ahmad Al-Jaber Al-Sabah, may Allah safeguard, His Highness the Crown Prince Sheikh Nawaf Al-Ahmad Al-Jaber Al-Sabah, may Allah safeguard, the Central Bank as well as all the regulatory authorities for their support of the banking sector of the State of Kuwait.

The success we have achieved, by the grace of Allah, clearly reflects the dedicated efforts of staff members and the confidence that our customers and shareholders have entrusted to us. Therefore, I would like to avail myself of this opportunity to express my thanks to them for their ongoing support. I would like also to extend my deepest gratitude to the Fatwa and Shari’a Supervision Board of KFH Group for their admirable efforts towards achieving the prestige and credibility our business deserves. We will seek to implement our plans in a disciplined manner in order for our organization to succeed in the long-term, and to provide sustainable returns to our shareholders and depositors.