H1 2025 Financial Results

21/07/2025
<h4>RAKBANK delivers record Profit Before Tax of AED 1.5B, up 26%, driven by Non-Interest Income growth and robust asset quality</h4>
Ras Al Khaimah, United Arab Emirates, July 21, 2025 - The National Bank of Ras Al Khaimah (RAKBANK) today reported its financial results for first Half of 2025
Highlights H1 2025
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&bull; All percentage variances are YoY
Key Financial Highlights &ndash; H1 2025
<ul>
<li>Profit after tax of AED 1,374M for H1&rsquo;25 up 26.1% over H1&rsquo;24. Profit after tax for Q2&rsquo;25 was AED 669M, reflecting an increase of 30% YoY</li>
<li>Operating Profit of AED 1,680M up 7.7% YoY on the back of strong growth in balance sheet and continued non-interest income momentum</li>
<li>Operating Expenses grew by 12.9% vs last year driven by continued investments in technology, data, people and customer experience. Cost to income ratio (CIR) at 34.6% vs. 33.6% for H1&rsquo;24</li>
<li>Total Assets grew by 18.1% YoY to AED 95B, with Gross loans &amp; advances increased to AED 51.3B mark, an increase of 17.4% YoY. Growth in loans driven by all segments, with Wholesale Banking loans growing by 33.0% YoY, aligning with the Bank's diversification strategy &nbsp;</li>
<li>CASA&nbsp;deposit base grew&nbsp;to AED 40.4B, up 12.2% YoY, with&nbsp;CASA1 ratio of 66%, one of the highest in the industry&nbsp;</li>
<li>Portfolio credit quality remains robust with&nbsp;Net Impairment charge to average loans and advances ratio&nbsp;at 0.7% against 1.7% during the same period last year, resulting from a strategic shift in business mix towards secured, low risk assets as well as favorable economic and credit environment</li>
<li>The impaired loan ratio for H1&rsquo;25 improved to 1.9% against 2.4% for H1&rsquo;24 while &lsquo;Provisions to Gross Loans&rsquo; ratio was 5.2% compared to 6.2% as of H1&rsquo;24, providing adequate coverage</li>
<li>Shareholder returns improved with Return on Equity (ROE) of 22.1% against 20.4% in H1&rsquo;24 and Return on Assets (ROA) of 3.1% against 2.9% in H1&rsquo;24</li>
<li>The Bank remains well capitalized with capital adequacy ratio (CAR) of 18.8% as at H1&rsquo;25 against 18.0% as at H1&rsquo;24</li>
<li>Strong liquidity position is reflected by an Eligible Liquid Asset Ratio of 15.1% vs. 15.5% at H1&rsquo;24 and Lending to Stable Resources Ratio at 80.7% vs. 79.4% at H1&rsquo;24</li>
</ul>
1- Current Accounts and Savings Accounts to total Customer Deposits
<img src="/contentassets/4fbb6aa8e9d248968302e24e3d3dbfa9/raheel-ceo.png" alt="CEO RAKBANK" width="209" height="209" />
Raheel Ahmed, Group Chief Executive&nbsp;Officer, RAKBANK said: Our &lsquo;digital bank with a human touch&rsquo; strategy continues to deliver strong, record-breaking results across all fronts. We remain well capitalized with strong liquidity and excellent returns. We have, once again, achieved strong balance sheet growth and fee income. This growth reflects the strength of our diversified business model and continued balance sheet momentum. Portfolio credit quality remains robust with cost of risk improving to 0.7% in H1 2025 from 1.7% in H1 2024.
We recently launched our most premium Credit Card &ndash; Elevate &ndash; that reimagines and re-defines rewards and benefits for our Elite Customers. To provide a &lsquo;human touch&rsquo;, we have launched our exclusive Elite centers in Dubai, Abu Dhabi and Ras Al Khaimah &ndash; for the convenience of our Elite customers. &nbsp; As the go-to bank for small businesses and entrepreneurs, RAKBANK was named &lsquo;Best Bank for SMEs&rsquo; in the UAE by Euromoney. We also partnered with Emirates Development Bank (EDB) to announce a landmark AED 1 billion co-financing initiative, unveiled at &lsquo;Make it in the Emirates&rsquo;, to empower UAE-based micro, small, and medium enterprises (mSMEs) and drive growth in national priority sectors. In H12025, we opened over 11,000 new accounts for entrepreneurs and small businesses and disbursed AED 2.54 billion in business loans to support their growth. Additionally, we launched the second edition of the RAKBANK SME Confidence Index, providing valuable market intelligence to support and empower the SME community. We remain very grateful to our customers for their confidence and loyalty.&nbsp;
Our active retail customer base grew 9.6% YTD driven by enhanced engagement and a sharper focus on delivering value. Card spending surged by 10% YoY. The Bank recorded over 28 million digital logins over the last 6 months and a 15% YoY increase in digital transactions, reflecting strong customer engagement across its platforms.&nbsp;
We continue to broaden our Corporate Banking offering in trade finance, escrow services and Debt Capital Markets (DCM), achieving landmark transactions as bookrunner and coordinator. This has resulted in higher fee and non-funded income growth. Our Financial Institutions Group expanded into new markets with a focus on trade.
In line with the UAE&rsquo;s Year of Community, RAKBANK actively supports society. This includes volunteering at the RAK Autism Center and running financial literacy sessions for children. We continue to organize community events for blue-collar workers and offer microfinance solutions for underserved segments. &nbsp; &nbsp; &nbsp; On the back of the UAE&rsquo;s strong economic fundamentals, we remain confident in delivering a solid performance in the second half of 2025, supported by our strategic execution and sustained business momentum. However, we remain cautious about the geopolitical and global economic uncertainties, including the loosening of monetary policy across key economies and its impact on margins.
<img src="/contentassets/4fbb6aa8e9d248968302e24e3d3dbfa9/h1-2025-assets.png" alt="h12025 digital transactions" />
&nbsp;
RAKBANK Awards &amp; Accolades for H1 2025
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<img src="/contentassets/4fbb6aa8e9d248968302e24e3d3dbfa9/image-3-awards2.jpg" alt="awards2" />
Financial Highlights for H1 2025
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Balance Sheet Highlights
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* Annualized **After application of Prudential Filter
Profitability growth driven by Non-Interest&nbsp;Income momentum and improvement in asset quality
<ul>
<li>Operating Income for H1&rsquo;25 amounted to AED 2.6B, a 9.5% increase vs H1&rsquo;24. Operating Income for Q2&rsquo;25 was AED 1.3B, reflecting an increase of 8.2% YoY</li>
<li>Net Interest Income increased by 0.8% compared to H1&rsquo;24 due to growth in total assets by 18% YoY, despite interest income being impacted by 100 bps rate cut in 2nd half of last year,</li>
<li>Despite external pressures on the net interest margin, on a risk adjusted basis - Bank&rsquo;s NIM has improved by 37 bps to 3.3% in H1&rsquo;25 compared to 2.9% in H1&rsquo;24, as the Bank&rsquo;s shifts toward secured, low-risk assets</li>
<li>Non-Interest income at AED 795M, increased by 35.6% from last year, driven by Bank&rsquo;s continued effort to diversify its Fee Income, Forex income and episodic gains in Investment Income</li>
<li>Net Impairment charge of AED 173M decreased by 52.5% compared to the same period last year, as the Bank&rsquo;s portfolio quality improves with Impaired Loan ratio decreasing to 1.9% from 2.4% as at H1&rsquo;24</li>
<li>Net Impairment charge to average loans and advances ratio was at 0.7% for H1&rsquo;25 compared to 1.7% during the same period last year</li>
</ul>
Total Balance Sheet reached AED 95.0B, as the Bank expands its offering
<ul>
<li>Total Assets increased by AED 14.6B reflecting a growth of 18.1% compared to H1&rsquo;24, with an increase in Gross Loans and Advances of AED 7.6B, Investments by AED 4.1B and Due from Banks by AED 3.0B</li>
<li>Wholesale Banking significantly contributed to the growth of the Balance Sheet, with segmental assets growing by AED 7.3B a 19.1% increase compared to H1&rsquo;24</li>
<li>Business Banking assets grew by AED 402M, a 3.9% increase compared to H1 of last year delivered primarily through growth in SME and Commercial loans</li>
<li>Personal Banking Loans and Advances rose by AED 3.0B to AED 23.5B, a 14.6% increase compared to last year with Mortgage and Leverage Loans driving growth, bringing in AED 1.8B and AED 800M year-over-year respectively</li>
<li>Customer deposits increased by 4.5% to reach AED 61B, while maintaining one of the industry&rsquo;s highest CASA ratios at 66%, serving as a testament to the trust our customers place in the RAKBANK franchise and our services</li>
</ul>
Cash Flows
<ul>
<li>Cash and cash equivalents as at Jun&rsquo;25 stood at AED 10.9B increasing by AED 1.4B compared to Jun&rsquo;24</li>
<li>Net cash generated from operating activities for H1&rsquo;25 was AED 1.6B, AED 1B was used in investing activities and AED 302M was received from financing activities</li>
</ul>
Impact of Capital Expenditure and developments
<ul>
<li>Capital Expenditure for H1&rsquo;25 amounted to AED 125M compared to AED 65.9M for the same period last year, as the Bank continues to invest in technology and infrastructure</li>
</ul>
Ratings
<ul>
<li>RAKBANK is rated by leading rating agencies. These ratings reflect the institutional strength of the Bank that is backed by trust and transparency in financial reporting and disclosures</li>
<li>During the reporting period both Fitch and Moody&rsquo;s have reaffirmed their credit ratings while Moody&rsquo;s has also upgraded Bank&rsquo;s credit Outlook from &lsquo;Stable&rsquo; to &lsquo;Positive&rsquo; underscoring the Bank&rsquo;s strong track record of executing its transformation</li>
</ul>
<img src="/contentassets/4fbb6aa8e9d248968302e24e3d3dbfa9/ratings-2025.png" alt="ratings2025" />
Raheel Ahmed Group Chief Executive Officer