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Mashreq posts 3% increase in net profit

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Mashreq has reported its financial results for the first half of 2017.

Its second-quarter net profit stood at AED 1.1 billion, which amounts to a 3% increase year-on-year. Its net profit rose to AED 557 million in the first three months this year, compared with AED 539 million during the same period last year.

Mashreq’s CEO, H.E. AbdulAziz Al Ghurair said, “Mashreq’s continued focus on business performance while remaining committed to our customers’ needs is evident in the financial results for the first half of 2017. Our perennial drive to deliver innovative solutions which exceed customer expectations is the reason we are able to achieve sustained performance, despite market slowdown and regional headwinds.”

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The bank has reported that impairment allowances fell 22.3% year-on-year.

The total operating income for the H1 2017 was AED 3 billion, a 5.5% decrease compared to last year, when operating income was AED 3.2 billion. This, the bank said, is due to a fall in non-interest income.

Net interest income and income from Islamic financing remained stable at AED 1.8 billion compared to the first quarter of 2016. On a quarterly basis, the income increased by 6.7%. And although the total amount of investment income increased by 52.4%, total non-interest income fell by 9.9% as net fee and commission decreased by 14.7% year-on-year to reach AED 763 million.

The net fee and commission income represented 61.9% of total non-interest income in H1 2017 as compared to 65.4% last year.

Mashreq’s total assets are AED 125.8 billion this year compared to AED 122.8 billion at the end of 2016 – an increase of 2.4%. Loans and advances have also increased by 2.4% to AED 62.4 billion when compared to year-end 2016. Customer deposits increased by 1.1% year to date to reach AED 77.9 billion and the bank’s loan-to-deposit ratio remained robust at 80.2% at the end of June 2017.

Non-performing loans stood at AED 2.6 billion in June 2017 leading to a gross loans ratio of 3.3% at the end of June 2017.

“While staying fully abreast of the external challenges, we remain moderately optimistic for the second half of 2017. We will continue to invest strongly in digital transformation and digital capabilities, to take advantage of global trends and customer preference shifts.” Al Ghurair said.

To celebrate the banks 50th year of proving financial services in the UAE, Mashreq will launch a digital banking platform to provide all regular banking services shortly.

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