Mashreq profit up 6.5% on lower costs

dubai — Mashreq reported on Sunday a 6.5 per cent growth in net profit to Dh2.1 billion in 2017, helped largely by lower impairment and operating costs.

Describing 2017 as a milestone year for the bank, Abdul Aziz Al Ghurair, CEO of Mashreq, said there had been a steady growth across all divisions “despite global economic uncertainty and the slight slowdown in the GCC region.”

“In addition to consistently reporting strong financial results and continuing to grow our business, we also celebrated our 50-year anniversary in the UAE. 2017 also saw the official launch of Mashreq Neo, our fullservice digital bank and the first digital bank in the region,” said Al Ghurair.

He said the focus would continue to be on providing innovative products and services, strengthening digital capabilities to meet the evolving demands of customers and maintaining leadership position in the market. “Innovation has been at the heart of the bank for the past 50 years and this will continue well into the future.”

“Moving forward, we will also continue to support the ongoing economic agenda of the UAE. While there may be challenges ahead, I am confident that we are well-positioned to capitalise on the improving economic backdrop in the UAE. I look forward to seizing these opportunities and continuing this momentum into 2018,” said Al Ghurair.

The bank’s impairment allowance declined by 14.2 per cent while operating expenses We are well-positioned to capitalise on the improving economic backdrop in the UAE Abdul Aziz Al Ghurair,

CEO of Mashreq

dropped by almost 2 per cent on the back of effective cost management, the Dubai-based bank said.

The bank’s best-in-class non-interest income to operating income ratio remained high above 40 per cent while investment income rose by 84.9 per cent. Total assets increased by 1.9 per cent and stood at Dh125.2 billion while loans and advances grew by 2.9 per cent in the year to reach Dh62.7 billion.

Customer deposits slipped marginally to Dh76.1 billion as on December 2017 while its loan-to-deposit ratio remained robust at 82.5 per cent at the end of December 2017.

The bank said its capital adequacy ratio and Tier 1 capital ratio continued to be significantly higher than the regulatory limit and stood at 18.3 per cent and 17.4 per cent, respectively.

Non-performing loans to gross loans ratio dropped to 2.94 per cent at the end of December 2017 compared to 3.06 per cent in December 2016 while total provisions for loans and advances reached Dh3.2 billion, constituting 149.7 per cent coverage for non-performing loans.

— issacjohn@khaleejtimes.com