SHARJAH: Sharjah Islamic Bank (SIB) net profit after tax soared to AED697.2 million in the first half of the year, marking a substantial 25 per cent increase from AED558.7 million recorded in the first half of 2024.
The impressive financial performance reflects SIB’s successful navigation through a complex economic environment while adhering rigorously to Sharia principles.
A pivotal contributor to this growth was the increase in income derived from investments in Islamic financing and sukuk, which rose by AED113.6 million or 6.4 per cent, amounting to AED1.9 billion in the first half of 2025, compared to AED1.8 billion in the previous year.
This increment highlights the bank’s adeptness at leveraging Islamic financial instruments to enhance income streams. Moreover, SIB’s ability to distribute AED1.1 billion to depositors and sukuk holders, surpassing last year’s AED1 billion, reflects the institution’s commitment to equitable profit distribution and its unwavering stability despite the volatile funding costs and pricing pressures characteristic of the current market.
The bank’s strategic emphasis on diversifying its revenue base is evidenced by the remarkable 53.5 per cent surge in net fee and commission income, rising to AED276.0 million from AED179.8 million in the first half of 2024.
The growth bolstered the total operating income to AED1.2 billion, a 13 per cent increase compared to the same period last year, showcasing SIB’s ability to sustain stable operations and capitalise on emerging opportunities across various economic sectors. Such diversification is a testament to the bank’s forward-looking approach in reinforcing income stability amid challenging economic conditions.
Operational efficiency remains a cornerstone of SIB’s financial management.
Although general and administrative expenses increased by 16.9 per cent to AED405.4 million, this rise was primarily driven by strategic investments in human capital, technological advancements, and operational infrastructure aimed at supporting business growth and enhancing customer experience.
Despite higher expenses, net operating income before impairment provisions rose by 11 per cent to AED757.2 million, highlighting the bank’s capacity to absorb cost pressures while maintaining profitability and efficient financial stewardship.
SIB’s credit risk management also witnessed significant improvement, as reflected by a net reversal of impairment provisions of AED 9.3 million, a marked enhancement from provisions of AED67.3 million in the previous year.
The positive turnaround indicates prudent risk management practices and effective recovery efforts, significantly contributing to the overall profitability and reinforcing confidence in the quality of the bank’s financing portfolio.
On the balance sheet front, SIB recorded an asset growth of 6.9 per cent, with total assets reaching AED84.7 billion by mid-2025. This growth is underpinned by a 12.9 per cent increase in total customer financing, which rose to AED 43.0 billion, alongside a rise in customer deposits to AED 52.7 billion.
The financing-to-deposit ratio improved substantially to 81.5 per cent, reflecting more effective utilisation of deposit bases for financing activities. The bank also maintained a strong liquidity position with a ratio of 21.1 per cent of total assets, ensuring ample liquidity buffers.
Finally, key financial indicators such as return on assets (ROA) and return on equity (ROE) demonstrated notable improvement, increasing to 1.70 per cent and 14.88 per cent, respectively, compared to 1.44 per cent and 12.76 per cent in the previous year. These enhancements underscore SIB’s growing profitability and efficient capital management.
