KEY THEMES
Faisal Islamic Bank of Egypt [FAIT] 2021 standalone bottom line expanded 30% y/y to EGP2.7bn. Net earnings growth came as a result of (1) 19% growth in net interest income of EGP5.4bn, and (2) better cost to income measures. What is more interesting is the sequential jump in FAIT’s Q4 2021 net earnings. The bank-registered bottom line of EGP1bn in Q4 2021 (+88% q/q, 37% of 2021’s EPS). The reason behind strong Q4 2021 was strong 35% y/y growth in net interest income of EGP1.6bn. In light of Q4 2021 results, FAIT’s ROAE is now at 17%. While some might argue that FAIT’s ROAE is not that rich, it does not really justify the current discount to FAIT’s book value. FAIT’s is currently traded at 2021’s P/E and P/B of 2.8x and 0.45x respectively, reflecting a discount that we think is overly stated. Moreover, FAIT’s BoD declared a DPS of EGP1.26/share, implying a dividends yield of 10%.