Mashreq 9-month profit surges 12%
dubai — Mashreq Bank announced on Tuesday a 12 per cent surge in profit to Dh1.7 billion for the first nine months ending 30th September 2017, compared to the same period last year.
Mashreq’s CEO, Abdulaziz Al Ghurair, said the bank been successful in increasing its loan book by six per cent year to date.
“It has been a period of muted growth for the UAE banking system with the banking sector Gross Credit growing by only 0.3 per cent as of August 2017,” he said.
“With a focus on cost management that has seen us reduce operating expenses by 1.7 per cent year-on-year and a strong 30 per cent decline in credit costs, I am delighted to report a 12 per cent year-on-year increase in net profits for the first 9 months of the year. Our strong liquidity and capital position has us well placed to capitalise on future growth opportunities,” said Al Ghurair.
He said Mashreq is investing significantly to develop new capabilities and evolve new business models as banking will go digital in the future. “Mashreq Neo, a full service digital bank, is a recent example of our response to the fast evolving needs of today’s consumers,” said Al Ghurair.
In a statement, the bank, said impairment allowance dropped by 30 per cent year on year while operating expenses declined by almost two per cent on the back of effective cost management. Total assets remained stable at Dh121.8 billion while loans and advances increased by six per cent to Dh64.7 billion as compared to December 2016.
Customer Deposits remained steady year to date at Dh76.1 billion while loan-to-deposit ratio remained robust at 85 per cent at the end of September 2017. Liquid assets to total assets stood at 26.7 per cent with cash and due from banks at Dh32.5 billion as on September. Capital adequacy ratio and Tier 1 capital ratio continue to be significantly higher than the regulatory limit and stood at 18 per cent and 17.1 per cent respectively.
Non-performing loans to gross loans ratio increased slightly to 3.7 per cent while total provisions reached Dh3.8 billion, constituting 134.4 per cent coverage for NPAs.
Total operating income for the nine-month was Dh4.4 billion, down by 4.9 per cent compared to the same 2016 period’s operating income of Dh4.7 billion due to a fall in non-interest income. Net Interest Income and income from Islamic Financing remained stable at Dh2.7 billion compared to the same 2016 period. Net interest margin for the nine months has increased to 3.45 per cent compared to 3.37 per cent for first half 2017. Operating expenses for the first nine months decreased by 1.7 per cent to reach Dh1.8 billion.
The bank’s total assets remained flat at Dh121.8 billion compared to Dh122.8 billion at the end of 2016. Liquidity continues to remain healthy with a high liquid asset to total assets ratio of 26.7 per cent, the bank said. Total customer deposits decreased marginally by 1.2 per cent to Dh76.1 billion due to a decline in both Islamic and conventional deposits.
Mashreq Neo, a full service digital bank, is a recent example of our response to the fast evolving needs of today’s consumers Abdulaziz Al Ghurair CEO, Mashreq