Bank Muscat (BKMB) H1 2025 earnings summary

Executive summary

• Net profit for H1 2025 rose 12.2% year-over-year to RO 125.82 million, driven by robust business growth, higher business volumes, and prudent credit cost management across both conventional and Islamic banking segments.

• Net interest income and income from Islamic financing increased by 8.3% to RO 206.44 million, while non-interest income grew 8.7% to RO 81.83 million, reflecting growth across all business lines and higher investment income.

• Operating expenses increased by 5.8% to RO 108.08 million, reflecting higher business activity and infrastructure investments.

• Loan portfolio grew 5.1% year-over-year to RO 10,724 million, and deposits increased by 3.3% to RO 9,879 million in H1 2025.

• Asset quality remains strong, with provision coverage at 1.7x non-performing loans and robust capital and liquidity positions.

Financial highlights

• Net profit for H1 2025: RO 125.82 million (12.2% increase year-over-year).

• Net interest and Islamic financing income: RO 206.44 million (up 8.3%).

• Non-interest income: RO 81.83 million (up 8.7%).

• Operating expenses: RO 108.08 million (up 5.8%).

• Operating profit: RO 180.2 million (up 10%).

Outlook and guidance

• Expectation of mid-single-digit loan growth for the remainder of 2025, driven by retail, public sector, corporates, and infrastructure projects.

• ROE target in the medium term is 13%-14%, with potential to exceed 14% with further optimization.

• NPL ratio expected to remain stable between 3%-4% for the rest of the year.

• The bank continues to focus on digital transformation, operational efficiency, and supporting key national projects.

• Oman’s macroeconomic environment remains stable with projected GDP growth of 2.4–3% in 2025 and continued fiscal consolidation.