Dubai: First Gulf Bank (FGB) on Tuesday reported a net profit of Dh2.68 billion for the first six months of 2014, up 21 per cent when compared to the same period last year.

The bank’s net profit for the second quarter of 2014 rose by 16 per cent to Dh1.35 billion.

The bank reported a 13 per cent growth in revenue to Dh2.28 billion in second quarter of 2014 compared to the same period last year.

Net interest and Islamic financing income increased by 12 per cent to Dh1.64 billion. This was primarily the result of an improving net interest margin at 3.7 per cent and higher loan balances as loans and advances grew 4 per cent during the quarter.

Non-interest revenues also rose by 18 per cent to Dh641 million when compared to the same period in 2013.

In the first half of 2014, FGB’s revenues were up by 17 per cent compared with the same period last year, rising to Dh4.53 billion.

“The strong results achieved during the first half of 2014 reflect the effectiveness of FGB’s strategy to expand and drive the business forward,” said Abdul Hamid Saeed, FGB managing director and board member.

Investment in FGB staff, marketing, and overall infrastructure, as well as the consolidation of Dubai First and Aseel, saw general and administrative expenses increase by 26 per cent to Dh1 billion compared with the first half of last year. Nevertheless, FGB’s group cost-to-income ratio remained at 22.2 per cent.

The bank continued to maintain healthy liquidity levels. Loan growth resumed in the second quarter of 2014 with loans and advances increasing 4 per cent to Dh128.2 billion. This was driven by growth across various sectors including services, the public sector and retail.

“We are committed to enabling our clients to fulfil their financial goals and aspirations. Moreover, the bank’s continued expansion into new markets allows our customers to access valuable opportunities both locally and abroad,” said Andre Sayegh, CEO of FGB.

With customer deposits adding 6 per cent to Dh137.5 billion in the first half, the June-end 2014 loan to deposits ratio improved to 93.2 per cent down from 95.2 per cent in the first quarter of 2014.

FGB’s asset quality metrics improved during the second quarter. The non-performing loan (NPL) ratio to gross loans reduced by 40 basis points during the quarter to 3 per cent. At the same time, provision coverage increased to 110.2 per cent from 96 per cent in March 2014.

As of June-end 2014, FGB has a strong position of general provisions, which amounted to Dh2.23 billion, a 44 per cent increase compared with the same period last year.

By end of the second quarter of 2014, total shareholders’ equity stood at Dh31 billion, an increase of 8 per cent when compared with the same period last year.

FGB’s capital adequacy ratio was at 19 per cent while its Tier-1 capital ratio stood 17.7 per cent at the end of the first half of 2014.