Mashreqbank reports 30% net profit growth in first quarter
The Mashreqbank Group reported healthy first quarter results of 2007 as core revenues from regular banking business showed considerable increase over last year. Total Net Profit of Dh445 million represents a 30 per cent increase over the Net Profit of Dh342 million posted for the same period last year. The Total Assets of the bank until the 31 March 2007 increased by 21 per cent to reach Dh61.7 billion from Dh50.8 billion in March 31, 2006.
Loans and Advances reached Dh29.77 billions compared to Dh27.5 billions last year, a growth of eight per cent. Customer Deposits increased by 14 per cent from Dh32.2 billion to Dh36.7 billion.
Mashreqbank CEO Abdul Aziz Al Ghurair said the bank’s continuing strong performance reflects the UAE’s robust economy as well as the bank’s commitment to continually enhance its product offering and value added services.
Net Interest income reached Dh331.5 million, which is almost 39 per cent higher than the 1st quarter last year Dh238.6 million. This was primarily on the back of healthy growth in the Balance Sheet. Commission income was higher by 61 per cent mainly due to increase in LC/LG business.
Other income resources showed a remarkable increase of 34 per cent backed by increased contribution from Cards, which reported a growth of over 60 per cent, and Foreign Exchange businesses which grew over 90 per cent.
Expenses increased by 47 per cent primarily due to investment in human resources, infrastructure and technology.
Continuing its prudent provisioning policy, Mashreqbank has set aside adequate allowances of 234 per cent for covering bad and doubtful loans and its General Provisions to Total Loans is over two per cent.
In January 2007, Mashreqbank launched its inaugural $500 million subordinated Lower Tier II transaction, marking the first transaction from the region in the year. The transaction achieved top class distribution in terms of geographic diversification, quantity and quality of investors. The issue was 3.5 times oversubscribed to a value of USD1.76 billion – the largest over subscription to date for a GCC financial institution bond transaction.
Mashreqbank’s international network expanded in the first quarter when its Bahrain operations went into full service at the beginning of April 2007.
Also during the quarter MashreqGold, the bank’s Premier Banking service, was launched with the opening of its first branch at Dubai Internet City. Further, Mashreq Securities, the bank’s brokerage arm, opened its third VIP lounge, the first in Sharjah for investors to trade in the UAE’s stock market.