H1 net profit at AED2.118 bn was down 23 pc YoY
DUBAI: Dubai Islamic Bank (DIB), the largest Islamic bank in the country and one of the oldest Islamic financial institutions in the world closed the COVID stricken quarter (Q2) rather unscathed by reporting a net profit of AED1.007 billion against AED1.398 billion the bank posted for the same quarter last year – registering a decline of 28 per cent.
The bank reported a net profit of AED2.118 billon for the first half (H1) of the current year compared with AED2.753 billion a year ago, reflecting a drop of 23 per cent.
The year-on-year drop in Q2 profit this year was mainly due to the increase in impairment loss from AED377.888 million to AED636.716 million representing 79 per cent growth on that count.
Total Income for the first half (H1) reached AED 6.824 billion, marginally below the similar period last year, despite headwinds. During the 6-month period under review, CASA deposits were up by 57 per cent year-to-date (YTD) to AED 86 billion, now forming 41 per cent of total deposits, which is viewed as a growing strength of the bank, especially in boosting bottom line.
The net financing and Sukuk investments during the first half grew to AED237.1 billion against AED184.2 billion in 2019, up by 29 per cent YTD.
Customer deposits grow 26 pc
Customer deposits increased to AED 206.5 billion up by 26 per cent YTD, whereas the total assets grew to AED295 billion, up by 27 per cent YTD. During the period under review, the cost to income ratio of the bank improved to one of the best in the industry at 29.4 per cent. The capital adequacy ratio (CAR) was at 16.7 per cent as on June 30, 2020, whilst CET 1 ratio was at 12.3 per cent.
Mohammed Ibrahim Al Shaibani, the chairman of Dubai Islamic Bank (DIB), said the new UAE government structure, along with more than AED6 billion Dubai economic stimulus measures that were unveiled by the leadership, are designed to bolster the market and boost investor confidence during and post the Covid era.
“During these critical times, we continue to engage effectively with all our stakeholders in order to ensure that our business operations are seamless,” Al Shaibani added.
The DIB Managing Director, Abdulla Al Hamli, said that the gradual return of economic activities is a manifestation of Dubai’s capabilities to withstand and address any significant global economic shocks.
“DIB has been able to quickly adapt to the so-called “new normal” in terms of servicing our customers via our diverse channels including the branch network and digital platforms, with minimal business disruption blended with stringent safety measures,” Al Hamli added.