(MENAFN- Emirates News Agency (WAM)) Commercial Bank of Dubai, CBD, has recorded a five percent increase in net profit during the first half of 2015 from AED581.1 million for the first half of 2014 to AED609.8 million.
Operating profit increased by 6.5% to AED764.3 million, mainly due to an 8.3% increase in Net Interest Income to AED802.4 million following balance sheet growth and a 22.2% increase in non-interest income to AED380.2 million with a significant increase in fees and commission (+34.3%) as well as an increase in foreign exchange income (+18.6%).
The bank's operating expenses increased by 25.1% from AED334.6million in H1-14 to AED418.4 million in H1-15, and the bank's personal banking strategy entails investments in its sales force, distribution network and digital banking platform. These investments led to a significant growth of the personal banking loan portfolio.
Loans and Advances of AED37.9 billion as at 30thJune 2015 registered an increase of 21.5% over the AED31.3 billion as at 30th June 2014 and were 18.2% higher when compared to AED32.1 billion as at 31st December 2014. Loan book growth was driven by all business segments. Personal Banking gross loans were at AED5.5 billion, a 43% increase when compared to the AED3.8 billion as at 30th June 2014. Commercial banking gross loans were at AED9.4 billion, a 19.7% increase when compared to AED7.8 billion last June. Corporate gross loans of AED25 billion were 12% (AED 2.6 billion) higher compared to AED22.3 billion as of June 2014, of which AED1.8 billion was from the acquisition of Royal Bank of Scotland (RBS) corporate portfolio in the UAE.
Customer Deposits of AED35.6 billion as at 30th June 2015 increased by 10.4% compared to AED32.3 billion as at 30th June 2014, and were 10.8% higher when compared to AED32.2 billion as at last year's end.
The bank's liquidity continued to be comfortable with advance to stable resources ratio of 90.1% as at 30th June 2015 (Dec-14: 82.6%), while the UAE Central Bank has set 100% as the maximum limit. Liquidity coverage Ratio (LCR) calculated as per BASEL-III guidelines was at 81.5% (Dec-14: 158.7%), compared to the minimum stipulated ratio of 60%. The Eligible Liquid Assets Ratio (ELAR) was above the minimum stipulated ratio by the UAE Central Bank of 10%.
CBD's Capital Adequacy and Tier 1 Capital Ratios were at 17.9% and 16.7% respectively and were significantly above the regulatory thresholds of 12% and 8% mandated by the UAE Central Bank. Leverage Ratio as per Basel III guidelines was 12.7% against regulatory requirements of 3% minimum (Dec-13: 13.04%).
Commenting on the bank's performance, Peter Baltussen, Chief Executive Officer, said, "CBD's net profit has consistently grown over the last quarters and our performance demonstrates the continued improvement and momentum across business lines. In the first half of 2015, CBD has underwritten new loans of AED11billion, increasing its loans and advances at a significantly higher than market rate of growth. With an increasing contribution from personal banking and business banking to the bank's income, CBD is positioned to deliver a robust performance in the coming years."
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