(MENAFN- Khaleej Times) Mashreq said on Wednesday that its first half net profit surged by 11.6 per cent year-on-year to reach Dh1.3 billion after a strong second quarter performance.
The bank, of the leading lenders in the region, said its operating income rose 5.7 per cent year-on-year to Dh3.0 billion driven by strong net interest income growth of 12.7 per cent year on year on the back of 4.5 per cent increase in loan volume and stable net interest margins.
Mashreq's CEO, AbdulAziz Al Ghurair, said the second quarter presented opportunities that helped the lender maintain its trajectory of growth. Customer deposits also increased by 10 per cent to reach Dh75.3 billion.
"This was on the back of 4.5 per cent year-on-year increase in loan volume and stable net interest margins. We attribute our success to our customers and our employees. Looking to the wider economy, the rest of 2015 looks promising for Mashreq as the region's non-oil sectors continue to grow and expand. The UAE remains a strong and stable economy and I know that our ongoing commitment to delivering excellence across the banking spectrum will enable Mashreq to continue climbing new heights of success," said Al Ghurair.
The bank's total assets increased by 6.1 per cent to reach Dh112.3 billion while customer deposits rose by 10 per cent to reach Dh75.3 billion due to a healthy growth of 54.8 per cent in Islamic customer deposits. Loan-to-deposit ratio remained robust at 77.6 per cent at the end of June 2015, the bank said in a statement.
Mashreq's liquid assets to total assets stood at 29.7 per cent with cash and due from banks at Dh33.4 billion. Capital adequacy ratio and Tier 1 capital ratio continue to be significantly higher than the regulatory limit and stood at 16.5 per cent and 15.2 per cent respectively.
The bank said non-performing loans to gross loans ratio remained steady at 3.7 per cent at the end of June 2 as total provisions for loans and advances reached Dh3.7 billion, constituting 138.4 per cent coverage for non-performing loans.
Mashreq's loans and advances increased by 3.1 per cent in the quarter to end at Dh58.4 billion, a slight increase from Dh58.0 billion at the end of December 2014.
On a year-on-year basis, loans and advances grew by 4.5 per cent driven by 6.3 per cent growth in conventional loans. Liquid assets to total assets stood at 29.7 per cent with cash and due from banks at Dh33.4 billion at the end of the first half.
Mashreq said its corporate finance has successfully closed its debut syndication in Turkey, arranging a $124 million multicurrency facility for Burgan Bank, where the bank has continued to grow its focus in recent years Corporate Banking Group has continued its trend of providing world class financing solutions with an emphasis on both relationship management and the provision of innovative solutions in the form of new products and services. The bank said Real Estate Finance & Advisory has built upon a strong 2014 by closing a number of landmark transactions with a total value of $1.3 billion during first half.
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