(Amman - April 2021) The General Assembly for Bank of Jordan shareholders held its meeting on Monday, April 19, 2021 by H.E Mr. Shaker Fakhouri, Chairman of the Board of Directors of Bank of Jordan. The meeting was held using virtual communication. The meeting was attended by shareholders who make up 64.14% of the capital. During the meeting, the items listed on the agenda of the General Assembly were approved.

On this occasion, Mr. Shaker Fakhouri, Chairman of the Board of Directors of Bank of Jordan, stated that the global economy witnessed an unprecedented decline in the year 2020 as a result of the Covid-19 pandemic and its negative impact on humans, the economy and society as a whole. The closures affected most economic sectors and the social distancing policy was imposed which has led to a significant decline in consumer spending, private investment, and demand for service sectors, especially travel and tourism, and a noticeable decline in foreign trade. Expectations indicated that the global economic downturn will be higher than the decline recorded during the global financial crisis, as the global economy recorded in 2020 a decline of 3.3%, and is expected to record 6% growth in 2021, driven by additional financial support, and the expected recovery thanks to vaccines in the second half of 2021. Bearing in mind that this expected improvement is subject to a large degree of uncertainty, related to the course of the pandemic, and the effectiveness of policy support in restoring normal conditions, depending on the availability of the vaccine and the development of financial conditions. The Arab countries were also affected by the economic downturn, especially the oil-exporting countries, in light of the decline in global demand for oil and the sharp decline in the price of oil, especially in the first half of 2020. As for non-oil countries, they were affected by the significant decline in workers' remittances, tourism revenues and exports.

Fakhouri added that the governments' response was quick to mitigate the effects of the pandemic by increasing spending on health services, with focusing also on the economic aspect, as they took many decisions and measures that worked to reduce the severity of the pandemic on the economic sectors, especially those most affected. In addition to reducing interest rates and injecting liquidity into the economies, this mitigated the economic effects and prevented this health crisis from turning into a financial crisis.

Fakhouri indicated that despite the exceptional challenges resulting from the Covid-19 pandemic crisis, the Bank was able to deal with these challenges thanks to the strength of its financial position, the strength of its capital base, the adequacy of its provisions, and its high liquidity ratios. The capital adequacy ratio reached 19.08%, the coverage ratio of provisions for non-performing loans reached 107.2%, and the legal liquidity ratio 130.7% as of the end of 2020, in light of the modest opportunities for good employment during 2020. The bank has also taken many measures that would have mitigated the economic impacts on corporate and individual customers, including restructuring, rescheduling, delaying installments, or reducing the burden of debt service, by reducing interest and participating in financing programs that targeted the sectors most affected by the crisis. He also discussed the contributions made to the societal initiatives launched in Jordan and Palestine to confront the effects of the pandemic, and to alleviate the burdens and worries, especially on the shoulders of the most affected groups, as the amount paid exceeded JOD 1.15 million for the "Hemmat Watan" fund in Jordan and the "Wakfet Izz" fund in Palestine. He added that the accumulation of experience and advance planning to deal with exceptional circumstances enabled the Bank to provide services to its customers in light of the Covid-19 pandemic, especially during the lockdown periods, as it was at the forefront of banks with the highest levels of readiness to provide its services to customers during the crisis. That is due to its possession of an advanced technological infrastructure that enabled it to provide its banking services electronically without the need for customers to visit the branches. All this is enhanced through prudent management of risks at the institutional level, upgrading of the information security and cybersecurity system, and the activation of flexible work patterns.

Reviewing the bank’s results, Fakhouri indicated that a net profit attributable to the Bank’s shareholders was recorded at an amount of JOD 35.8 million for the year 2020 compared to JOD 40.2 million in 2019, showing a decrease of 10.9%. In spite of the decline in profitability, the rates of returns are still within good and acceptable levels in light of the circumstances that rocked the economies of the countries in which the Bank operates and the volume of its ECL for the year 2020. The return on assets (ROA) reached 1.31%, and the return on equity (ROE) of the Bank’s shareholders was 8.24% at the end of 2020. The Bank’s capital base is sufficient to face the shocks and risks that it may be exposed to.

As a result of the current economic conditions and the uncertainty that dominated the economic scene in light of the pandemic and its future consequences, the expected credit loss (ECL) jumped from JOD 18.6 million in 2019 to JOD 31.9 million in 2020. This is in addition to the implications for the decline in the bank's margins as a result of the lower returns on credit facilities in the banking sector, with operating profit amounted to JOD 127.7 million, down 8.8% from the end of 2019.

In terms of the Bank’s financial position, total assets recorded JOD 2.7 billion at the end of 2020. Shareholders equity also registered JOD 454.7 million. In terms of investments and sources of funds, the Bank's loans portfolio (at amortized cost) amounted to about JOD 1.5 billion, an increase of 4.1% compared to 2019. The financial assets portfolio also grew by 26.6% amounting to JOD 448.1 million. Customer deposits also reached JOD 1.9 billion.

Fakhouri stressed that the Bank's solid financial position, the strength of its capital base, and the completion of strategic projects will enhance the Bank's ability to face challenges as the pandemic subsides, life gradually returns to normal, and the economic recovery begins. In tangent, the Bank is also able to evaluate opportunities and take advantage of them in the event of the pandemic continuing until life returns to normal. This comes in line with the Bank's rapid response in keeping up with developments and challenges in the business environment, as well as seizing opportunities by entering new markets and harnessing modern tools and technologies in providing services to chart a new path that is more adaptive and flexiblThe General Assembly approved during its meeting the recommendation of the Board of Directors of Bank of Jordan to distribute cash dividends to shareholders at a rate of 12% for the year 2020. During the meeting, a new Board of Directors of Bank of Jordan was elected, consisting of eleven members, for a period of four years. On this occasion, Mr. Shaker Fakhouri, extended his thanks and appreciation to the previous board of directors, at the end of their term, appreciating their efforts over the past four years in achieving the advancement and prestige of the Bank in the countries in which it operates.

In conclusion, Mr. Shaker Fakhouri extended his thanks and appreciation to the Bank's shareholders and clients for their support and confidence in Bank of Jordan Corporation, and to the Bank's employees for their efforts and dedication in providing the best services to customers. He also thanked all national institutions, led by the Central Bank of Jordan and the Ministry of Industry and Trade, for their role in supporting the economic sectors, and for the efforts made by various bodies at all levels in the Kingdom to overcome the unprecedented conditions due to the Covid-19 pandemic crisis and limit its consequences. We hope from the Almighty God to keep Jordan secure and stable under the shadow of His Hashemite Majesty King Abdullah II Ibn Al-Hussein, may God preserve and protect him.