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RAKBANK Reports AED 530m Profit for First Nine Months of Year
- Profits up by 10.40%
RAKBANK has reported a net profit of AED 530.66 million for the nine months ended 30th September 2009, reflecting a 10.40% increase compared to the same period last year. These positive results continue the bank’s trend of profitable growth notwithstanding negative economic factors. The bank has continued to register growth in its chosen segments of small business finance, personal loans, mortgages and credit cards.
“The past year has been a testing time for the banking industry in general, but in spite of the difficult conditions, RAKBANK has continued to register quarter-or-quarter and year-on-year growth in profits,” says Graham Honeybill, General Manager at the bank. “We remain one of the most profitable banks in the Middle East region in terms of return on capital and equity. By continuing to seek good lending opportunities, we have strengthened our position as one of the largest credit card providers in the country and an important provider of mortgage and SME finance.”
Over the nine-month period, the bank’s net interest income at AED 850.87 million increased by 32% compared to the same time last year. Gross Loans and advances stood at AED 13.17 billion, a 17% increase over the nine month period and a 23% increase over the same time last year.
“We are beginning to see signs in the market that economic conditions are slowly improving and the challenges of the financial crisis are easing,” adds Honeybill. “RAKBANK’s liquidity is currently at a comfortable level. Interbank rates are significantly lower and domestic deposit rates are falling, although the latter remains high for a US dollar-linked currency. A further fall is necessary as a stimulus to increase bank lending and economic activity.”
The bank’s capital adequacy ratio as at 30th September 2009 stood at 15.05%, against a minimum of 11% mandated by the Central Bank. This ratio will be boosted to 20% once deposits received from the Ministry of Finance are included in the calculation upon completion of legal formalities. The advances to deposits ratio stood at a comfortable level of 93.6% as per the UAE Central Bank calculations.
The bank has taken adequate provisions on its loan portfolio, with AED 167 million set aside for impaired loans for the nine month period. Honeybill also said that leading-edge business indicators suggest that delinquency is declining and, if these projections are ratified by future results, there should be a proportionate decline in provisioning in 2010. The bank has no direct or indirect exposure to any corporate group significantly affected by the financial crisis.
Fee, commission and other income at AED 390 million was up by 11% compared to the same time last year. Total assets stood at AED 16.38 billion, an 18% increase from year-end 2008, and 20% higher than the same period last year. The main growth in assets was seen in loans and advances.
During the year, investments totalling AED 209 million matured leaving an outstanding portfolio of AED 560 million at the end of September. The bank intends holding all investment to maturity and does not anticipate any loss on any of its investments, all of which are in the name of domestic institutions.
The growth in the banks’ asset book has been supported by a combination of increase in customer deposits and shareholders’ equity. Customer deposits were up by AED 2.64 billion over the nine month period due to a combination of term and transaction deposits. Total shareholder’s Equity stood at AED 2.61 billion at the end of September.
About RAKBANK
RAKBANK, also known as the National Bank of Ras Al-Khaimah, is a leading retail bank in the UAE, serving 340,000 customers. Founded in 1976, the bank is one of the country’s oldest local financial institutions and today one of its fastest growing most dynamic banks and a major player in the personal banking sector in the UAE.
The bank offers a wide range of personal banking services through its 27 branches and telephone and online banking channels. It is a leading provider of credit cards and a prominent player in mortgage finance and small to medium enterprise finance.
Customer service excellence is a cornerstone of the bank’s success, with the bank having been voted in 2008 for three years running as #1 Bank in Customer Service in the UAE Annual Bank Benchmarking Study. For more information, visit www.rakbank.ae or contact the Call Centre at +9714 213 0000.
MediaContacts:
Basma Alwesh, Dir Tel: 971 4 2915064, mobile: 971 50 6500743, email: basma@rakbank.ae
Lamis Daoud, Dir Tel: 971 4 2915055, mobile: 971 50 2601156, email: lamis.daoud@rakbank.ae
