The Arab Petroleum Investments Corporation (APICORP), a multilateral development financial institution, reported a 17% year on year increase in net recurring income to $112 million in 2019, up from $96 million (excluding non-recurring items) the previous year.
APICORP’s growth was driven by its corporate banking and treasury unit, whose gross income increased 32% and 24% year-on-year to reach $201 million and $80 million, respectively.
The corporation’s balance sheet grew by 5.7% increase from $6.95 billion in 2018 to $7.35 billion. Leverage (debt-to-equity ratio) remained in check reaching 2.13 in December 2019 compared to 2.07 in the same period last year, and capital adequacy improved slightly from 29.34% in 2018 to 29.6% in 2019.
In October 2019, APICORP’s overall credit rating was upgraded by Moody’s to ‘Aa2’ with a stable outlook from ‘Aa3’. The achievement was due in large part to the steady improvement in APICORP’s liquidity and funding profile, high quality assets, strong asset performance, and moderate leverage, amongst other factors. This makes APICORP the only financial institution in the MENA region with a ‘Aa2’ rating.
Commenting on APICORP’s results, Dr. Aabed bin Abdulla Al-Saadoun, chairman of the board of directors said: “As the world enters an unprecedented period of economic uncertainty, I am reassured by the fact that we have closed out the past year on a strong note. Our business lines exhibited exceptional resilience on the back of challenging market conditions presented by both geopolitical, financial and industry developments in 2019.
“The increase in net recurring income by 17% and Moody’s credit rating upgrade are both significant milestones that stand as a testament to APICORP’s solid fundamentals. This gives us the confidence to continue to support to the Arab world’s energy sector during a time when sustainable, impact-driven projects have never been more needed.”
Dr. Ahmed Ali Attiga, CEO of APICORP, said: “We are extremely proud of another successful year for APICORP as we continue to navigate a rapidly evolving energy landscape. Our balance sheet growth to USD7.35 billion in 2019 paves the way for APICORP to continue an upwards trajectory, notwithstanding the limitations that the current coronavirus crisis poses upon all sectors of the global economy. However, I believe that the work that we have put into diversifying our portfolio in terms of sectors and geography as well as our broad investor base, coupled with our strong financial position, will serve us well in the coming years and allow us to address the current challenges.”
“When the world eventually begins to recover from the dual impact of the coronavirus pandemic and oil price fluctuations, we will most likely see changes in the region,” added Dr. Attiga. “As a trusted financial partner to the regional energy sector, we are well positioned to support sustainable investments, and entities, that can accelerate both economic recovery and the low-carbon transition. Going forward, we believe that there will be a greater role for multilaterals like APICORP, serving in a countercyclical capacity to reinvigorate the economies of the region. For this, we remain committed to playing a strong developmental role, particularly through leveraging on our partnerships in the industry.”
