Chairman Message

Mr. Rashad Al Zubair

Rashad Al Zubair


Board of Directors report for the fiscal year ended 31 December 2019

Dear partners,

On behalf of the Board of Directors, I am pleased to present the consolidated financial statements for the year ended 31 December 2019, together with relevant financial statements reflecting the Bank’s results and achievements over the past year.

Despite the economic and financial challenges we faced as a result of the fluctuations in oil prices and the high-interest rates of deposits during the past year, Oman Arab Bank has recorded an outstanding performance. This is indicated by a rise of 6% in net income, reaching a value of OMR 92,960 million.

Operating costs have slightly increased by 4%, resulting in an increase of 8% in net profit on an annual basis, to the value of OMR 32,560 million by the end of 2019. In comparison, the value for the same period in 2018 was OMR 30,140 million. Net interest income saw an increase of 9%, amounting to OMR 71.3 million. Loan value has also increased by 10%, amounting to over OMR 2 billion. This is complemented by a 7% increase in customer deposits, which achieved OMR 1.99 billion.

In regards to assets, the Bank’s total assets increased by 7% by the end of 2019, which is approximately OMR 2.5 billion. Meanwhile, the Capital Adequacy Ratio reached 15.2%, higher than the regulatory percentage set at 14.50%.

This positive growth is thanks to the Bank’s strategy, which relies on four main pillars.

The first is to enhance the overall and integrated experience for the customer, both within branches or through digital channels. Over the year, we have seen the addition of several new and advanced services that help establish the Bank’s position as a lifelong banking partner for its customers.

The second pillar is to enhance our approach to work in an innovative manner, and build a team capable of creating and introducing innovative products that best meet the needs of the customer. Efforts have continued to establish the first innovation laboratory for Oman’s banking sector, set to officially open in the first quarter of 2020. This will go hand-in-hand, simultaneously, with the launch of the second edition of Oman Arab Bank Innovation Hub which targets different segments including college students, Fintechs, as well as the Bank’s employees.

The third pillar of OAB’s strategy focuses on building strategic partnerships that help the Bank provide new value-added services and products to the customer, through the Bank’s partners. OAB succeeded in establishing several alliances throughout 2019, their impact appearing in the year-end results.

The fourth strategic pillar is managing talents and competencies within the Bank, so that a clear work plan for career advancement is set on the basis of competence training and qualification. The past year (2019) witnessed the implementation of many training programmes and workshops to raise the efficiency of employees at all levels and to qualify them for larger and more diverse tasks, with the ultimate goal to enhance customer satisfaction. In line with our commitment to Omanisation, the Bank has maintained its accomplishments by maintaining the highest Omanisation rate in the sector, at 96%.

Last year, Oman Arab Bank initiated a proposal to merge with Alizz Islamic Bank and to form a larger banking entity, operating in both the commercial and Islamic banking sector. At the end of the year, the Bank received a letter of acceptance for the proposal from Alizz Islamic Bank management. We look forward to completing approvals from shareholders and supervisory and regulatory authorities to move forward with this strategic step in the year 2020.

The year 2020 started with the tragic loss of the founder of Oman’s modern renaissance, the late His Majesty Sultan Qaboos bin Said bin Taimur, who passed away on January 10, 2020. Hope was renewed when His Majesty Sultan Haitham bin Tarik took office, to lead the Sultanate into a future of continued growth, prosperity and development. We, in turn, are fully aware of the role assigned to the private sector at this stage, and look forward to contribute consistently to the ongoing development at all levels. We have full confidence in the national economy and the ‘Oman 2040’ future vision.

Allow me to express my sincere congratulations to His Majesty Sultan Haitham bin Tarik. We pledge loyalty to him and his wise leadership, and the future of our dear country. May Allah protect him, Oman and its people.

I would like to thank the management of Central Bank of Oman for its valuable guidance and successful leadership of the local banking sector, as well as all customers, partners and shareholders. Your confidence has been the cornerstone of our path to success.

Lastly, I would like to extend my gratitude and appreciation for the executive management at the Bank and all employees.  It is their valuable contributions and efforts that have allowed us to achieve the desired goals for the year 2019. On behalf of the members of the Board of Directors, please accept my sincere thanks for your commitment to making Oman Arab Bank better.

Rashad Mohammad Al Zubair