Bank Muscat’s financial performance reached historic highs in the year 2022. This combined with its multifarious achievements makes it a deserving numero uno.

Bank Muscat set new benchmarks with its financial performance in the year 2022, reflecting its quality offerings, service differentiation and best-in-class systems and processes. The bank posted a net profit of RO200.75mn for the year 2022 compared to RO189.63mn reported during the same period in 2021, an increase of 5.9 per cent.

Net interest income from conventional banking and net Income from Islamic financing stood at RO344.86mn for the year ended December 31, 2022, compared to RO335.54mn for the same period in 2021, an increase of 2.8 per cent. Non-interest income was RO157.96mn for the year 2022 as compared to RO139.94 mn for the same period in 2021, an increase of 12.9 per cent mainly due to higher investment income.

Operating expenses for the year were RO207.30mn as compared to RO191.46mn for the same period in 2021, an increase of 8.3 per cent. Net impairment for credit and other losses for the year was RO59.94mn as against RO60.22mn for the same period in 2021. Net loans and advances including Islamic financing receivables increased by 2.5 per cent to RO9,417mn as against RO 9,191mn as of December 31, 2021.

Customer deposits including Islamic customer deposits decreased by 1.5 per cent to RO8,647mn as against RO8,775mn as of 31 December 2021. The basic earnings per share was RO0.026 in 2022 against RO0.024 in 2021.

The bank’s capital adequacy ratio stood at a very healthy level of 21.25 per cent as on December 31, 2022, after appropriation for the proposed dividend for the year 2022 against the minimum required level of 13.25 per cent as per Basel III regulations issued by the Central Bank of Oman. For 2022, the Board of Directors proposed a dividend of 15 per cent in the form of cash. Thus, the shareholders would receive a cash dividend of RO 0.015 per ordinary share aggregating to RO112.596mn on the bank’s existing share capital.

Strategic initiatives & key developments

In 2022, Bank Muscat celebrated 40 years of progress and contribution to Oman’s socio-economic development by intensifying its efforts to enhance customer satisfaction and fulfil its responsibilities to society and its various stakeholders. A new organisational structure was put in place on January 1, 2022, in alignment with the bank’s strategic plans to empower Omani talent to assume positions of greater responsibility at the bank.

In another key development, Bank Muscat held an Extraordinary General Meeting (EGM) and an Ordinary General Meeting (OGM) on 9 November 2022. At the EGM, shareholders approved increasing the Bank’s share capital from RO 450,000,000 to RO 800,000,000. The EGM approved the issuance by way of a dividend of 375,319,853 subordinated, perpetual AT 1 bond to the bank’s list of shareholders at the rate of 1 bond per 10 ordinary shares held by the shareholders on the meeting date. The OGM approved the distribution of bonus shares at the rate of 1 bonus share for every 1 share held by the shareholders of the Bank on the meeting date.  The distribution of bonus shares has resulted in an increase in the issued share capital of the Bank from 3,753,198,531 shares (aggregating to RO 375,319,853) to 7,506,397,062 shares (aggregating to RO 750,639,706).

The bank has been spearheading a massive digital transformation in the banking and financial services sector in the Sultanate of Oman by providing a complete range of technology-driven digital offerings. As a result, digital banking continued to make excellent progress, with registered users of Mobile and Internet banking reaching the 1.4 million mark.

In 2022, Bank Muscat launched several customer-centric initiatives, including Digital Onboarding of customers, a Soft Token app for Internet banking customers, online reKYC, and online applications for various products like credit cards and mutual funds, among others to enhance the overall customer experience. Further supporting its upward trajectory, the bank saw tremendous growth of about 150 per cent in new merchant partners and about 40 per cent in acquiring transactions.

Bank Muscat’s new innovative digital banking services are enabling government and corporate entities to make the best use of technology and processes to supercharge their business environment. Overall, transactions processed through corporate online banking soared to an unprecedented RO8bn in 2022. The Bank also launched a new DigiTrade portal and a new Visa Virtual Corporate Credit Card Solution during the year, further empowering corporate customers with real-time transaction security and control over their transactions.

The bank maintained its leadership position in project and structured finance, enabled by its deep sectoral expertise, innovative structuring capabilities and sound due diligence techniques to cater to the long-term financing requirements of various projects in critical sectors such as oil and gas, petrochemicals, renewable energy, manufacturing, telecom, real estate, aviation and power and water.

Bank Muscat also completed several financial advisory and fundraising transactions, including US$495mn (approximately RO190mn) fundraising for the acquisition of infrastructure assets within the telecom sector in Oman, supply-chain financing for the Government of Oman amounting to about US$1.5bn (approximately RO595mn), financial advisory for a leading Government-related Entity (GRE) in the utility sector and the IPO of Barka Desalination Company amongst others.

In addition, achieving another significant milestone, Bank Muscat Money Market Fund’s Assets under Management (AUM) crossed RO90mn during the year, making it the largest open-ended Fund in Oman.

At the same time, Meethaq, which celebrated its 10th anniversary in 2022, continued demonstrating its strong leadership in the Islamic banking space by increasing its customer base and recording healthy growth in net and operating profit. Other key developments during the year included the appointment of a new Shariah Supervisory Board under the chairmanship of Sheikh Dr Abdullah bin Mubarak Al Abri and the successful redemption of Meethaq’s Sukuk Series 1 amounting to RO44.6mn.

Corporate Social Responsibility and Sustainability

Moving further ahead on its strategy of improving financial inclusion to different customer segments in Oman, the Bank expanded its network of digital banking devices like Automated Teller Machines, Cash Deposit Machines, Full-function Machines, Statement Printers and Multi-function Kiosks to a total of 821 devices by December 2022. The Bank has made significant progress in implementing new regulatory guidelines on servicing customers with disabilities and is in the process of further upgrading disabled-friendly facilities at branches across all governorates.

In 2022, Bank Muscat sustained its pioneering Corporate Social Responsibility (CSR) efforts through several long-running programmes and one-off activities supporting the social investment pillars of Youth & Sports, Economy, Education, Environment and Social Welfare.

The Bank successfully completed its Tadhamun programme for the 10th consecutive year, in partnership with the Ministry of Social Development, with a joint team distributing household appliances to over 200 social welfare families across different governorates. Earlier during Ramadhan, the Bank participated in the annual ‘Fak Kurba’ initiative of the Oman Lawyers Association for the 5th consecutive year and helped secure the release of those convicted of financial default in 260 humanitarian cases.

Bank Muscat continued its essential role in supporting SMEs in Oman by providing, the programme was provided at no cost to participants, an advanced entrepreneurial programme to 30 toppers from the Bank’s Al Wathbah SME Academy. Earlier in the year, the Bank conducted the annual Souq Al Wathbah, which saw strong participation by over 120 Omani SMEs showcasing a diverse range of products.

Based on its multifarious achievements Bank Muscat retained its No. 1 position on OER’s Best Bank’s survey for the year 2022.