(MENAFN - Khaleej Times) Shreq bank announced on Wednesday a 40 per cent increase to Dh1.The bank said it net profit in the second quarter reached Dh585 million an increase of 45 per cent from last year. It maintained the momentum of the first quarter.
Total operating income for the first half of 2014 grew to Dh2.9 billion an increase of 26.4 per cent compared to a year earlier driven by both net interest income and net fee and commission income the bank said in a statement.
AbdulAziz Al Ghurair Mashreq’s CEO said the first half results underscored the fact that the bank is steaming ahead to a record year in a sustained manner recording both top and bottom line growth because of equally strong performances from the corporate retail and international divisions.
“This performance has been made possible by putting our long held philosophy of customer-centricity to work allowing people to recognise that we are more than just a bank we are a financial partner providing them with the banking solutions they need for all aspects of their lives” Al Ghurair.
“Seeing how the UAE economy is picking up speed we believe that this is the time when banks that will benefit the most will be those who are genuinely committed to putting their customers first and investing in the innovative platforms needed by the smart banking public in our market” he said.
Net interest income at the end of June 2014 was up by 38.1 per cent compared to a year earlier driven by 11 per cent year-on-year increase in loan volume and 33 bps improvement in net interest margin from 2.7 per cent in June 2013 to three per cent this year which was predominantly led by change in balance sheet structure and composition of loans.
The bank’s net fee commission and other income to operating income ratio remained hight 49.5 per cent led by a 25.7 per cent growth in net fee and commission income and 30.4 per cent growth in net investment income over first half of last year the statement said. General and administrative expenses for the period increased by 5.4 per cent compared to a year earlier to reach Dh1.1 billion; However Mashreq’s efficiency ratio improved by 7.4 per cent on a year-on-year basis to reach 37.2 per cent at the end of June 2014.
Earnings per share strengthened to Dh6.86 at the end of June this year compared to Dh4.90 a year earlier.
Asset quality continued to improve as non-performing loans to gross loans ratio reduced from 6 per cent in December 2013 to 5.7 per cent at the end of June 2014. Mashreq’s allowances for impairment net for H1 2014 was Dh556 million and total provisions for loans and advances reached Dh3.6 billion constituting 105 per cent coverage for non-performing loans as on June 30 2014.
Mashreq’s capital adequacy ratio and tier 1 capital ratio continue to be higher than the regulatory limit and stood at 16.1 per cent and 14.7 per cent respectively at the end of June 2014.
Total assets of the bank increased by 15.9 per cent to reach Dh103.9 billion in June 2014 compared to Dh89.7 billion at the end of 2013. Liquid assets to total assets stood at 29 per cent with Cash and Due from Banks at Dh30.5 billion at the end of the first six months. Loans and advances grew by 11 per cent during the first half of 2014 to reach Dh56 billion compared to Dh50.4 billion at the end of December 2013. Customer Deposits increased by 20.7 per cent during the same period to stand at Dh70.6 billion at the end of June 2014.
The bank said its loan-to-deposit and loan-to-total assets ratio stood at 79 per cent and 54 per cent respectively at the end of June 2014. — issacjohnkhaleejtimes.com