Dubai Islamic Bank (DIB) announced today its financial results for the first half of this financial year ending 30 June 2009, demonstrating the Bank’s continued profitable operations despite extremely challenging conditions.
During the second quarter of 2009, the Bank’s net profit reached AED 450 million, a rise of 22 percent compared to AED 370 million during the first quarter of the year. The Bank has made impairment provisions of AED 135 million for the same period. The Bank’s total impairment provision for first half of 2009 now stands at AED 239 million. This reflects a prudent and conservative approach during a period of marked global financial instability.
The Bank’s total assets as at 30 June 2009, stood at AED 87.8 billion, up 3 percent compared to AED 85.0 billion at 31 December 2008. Customer deposits increased 8 percent to reach AED 71.5 billion at June 2009, compared to AED 66.4 billion at 31 December 2008, reflecting the strong loyalty DIB enjoys amongst its customers.
In the first half of 2009, DIB’s investing and financing assets reached AED 50.7 billion compared to AED 52.6 billion at 31 December 2008. The Bank’s financing-to-deposit ratio stood at 71 percent as of 30 June 2009. The improved ratio reflects the Bank’s conservative credit policy as well as a strong liquidity position, which will enable DIB to expand its credit portfolio when the economy recovers.
His Excellency Mohammed Ibrahim Al Shaibani, Director-General of His Highness The Ruler’s Court of Dubai and Chairman of Dubai Islamic Bank, said: “The past few months have been challenging for the banking and finance industry in the region and globally. As we begin to see gradual stabilisation of the markets in the past quarter, DIB is optimistic of the recovery of regional markets. The Bank has successfully integrated its diversification strategy and this is reflected in its improved liquidity position and strong performance.
“Our customers are our top priority, and we remain committed to playing a leadership role in the financing sector by providing financial solutions, products and services that help government and semi-government organisations and private-sector firms realise their long-term growth potential.”
The second quarter of 2009 was marked with significant developments at DIB. The Bank launched a one-year Islamic Certificate linked to the Crescent Commodity Twister Strategy developed by ABN AMRO Bank. This US dollar-denominated certificate, offers investors ideal exposure to the global commodities market, and seeks to generate 96 per cent capital protection upon maturity. Jordan Dubai Islamic Bank received a preliminary banking licence by the Central Bank of Jordan to operate as an Islamic financial institution, with a share capital of US$100 million.
During the current quarter, DIB also bought back its sukuk amounting to US$ 83 million through a US$ 200 million cash tender offer to its sukukholders, which was announced in May 2009. The Bank purchased the trust certificates at 88 per cent of the face value. Through this transaction, DIB has become the first Islamic bank to buy back its outstanding trust certificates through a cash tender offer.
About Dubai Islamic Bank:
Dubai Islamic Bank (DIB), established in 1975, is the first Islamic bank to have incorporated the principles of Islam in all its practices and is the largest Islamic bank in the UAE. DIB is a public joint stock company, and its shares are listed on the Dubai Financial Market. The bank enjoys a reputation as a leader and innovator in maintaining the quality, flexibility and accessibility of its products and services.
The bank currently operates 57 branches in the UAE. As part of its expansion plans announced in early 2009 and in line with its aim to ensure customer satisfaction through accessibility, DIB will increase its nationwide network to 64 branches by the end of this year. In addition to regular, full-service branches, DIB is also planning to launch Express Banking Centres, which will provide fast, efficient services to DIB customers at various convenient locations like shopping malls, hypermarkets and megastores
By the end of 2009, DIB forecasts that the bank’s total customer base will increase by approximately 15 per cent, reaching some 900,000 customers, while its retail assets business will grow by approximately 20 per cent.
DIB has been proactive in creating partnerships and alliances at both the local and international level. The bank has established DIB Pakistan Limited, a wholly owned subsidiary. DIB has also opened its first representative office in Turkey to enhance its access to that market. DIB has also acquired a stake in Al Khartoum Bank and in Emirates and Sudan Bank, as well as contributing to the launch of Jordan Dubai Islamic Bank.
DIB has won the respect of its peers around the world for many years, and its leading position has been reaffirmed by the 34 awards that it has won in 2008 across diversified areas within banking, be it retail, corporate or investment banking. The bank was recently named “Best Islamic Bank” for the 4th consecutive year by Banker Middle East magazine. DIB has also received many awards from international organisations, such as the prestigious “Bank of the Year” award from The Banker (Financial Times), along with prestigious accolades from UK based Euromoney and NY based Global Finance magazines.
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