A CBD branch in Dubai. The bank delivered an excellent performance in 2019 with strong asset growth and higher other operating income. Image Credit: Ahmed Ramzan/Gulf News Archives

Dubai: The Commercial Bank of Dubai (CBD) on Wednesday reported net profit of Dh1.4 billion for 2019, up 20.5 per cent year on year.

The result was delivered on the back of broad based business improvements aligned with the bank’s strategy.

“CBD has delivered an excellent performance in 2019 with strong asset growth and higher other operating income. The result has been achieved through the disciplined execution of our strategy and reflects continuous improvements across all aspects of our business,” said Dr. Bernd van Linder, Chief Executive Officer of CBD.

Operating income for 2019 amounted to Dh3.03 billion, an increase of 11.3 per cent attributable to a 2.8 per cent increase in net interest income (NII) and a 31.2 per cent increase in other operating income (OOI).

Fees and commission income increased by 21.3 per cent, foreign exchange income registered a 37.7 per cent increase, investment income increased by 179.4 per cent, and other income increased by 53.3 per cent compared to 2018.

Balance sheet growth

Total assets were up 18.8 per cent at Dh88.1 billion at the yearend 2019 compared to Dh74.1 billion at the yearend 2018.

Net loans and advances grew by 18.1 per cent to Dh60.2 billion, registering an increase of 18.1 per cent compared to Dh50.9 billion as at the end of 2018.

Customers’ deposits grew 19.1 per cent year on year to Dh63.3 at the close of 2019. Low cost current and savings accounts (CASA) constitute 39.4 per cent of the total deposit base, while the financing-to-deposits ratio stood at 95 per cent.

The non-performing loan (NPL) ratio improved to 5.94 per cent from 6.18 per cent at the end of 2018. The bank made additional net impairment provisions of Dh748 million during the year resulting in the coverage ratio improving to 83.14 per cent in 2019 from 77.82 per cent.

The bank’s liquidity position remained robust with the advances to stable resources ratio at 88 per cent at the yearend 2019. CBD’s Capital ratios remained strong with the capital adequacy and common equity Tier 1 (CET1) ratios at 14.01 per cent and 12.85 per cent, respectively.

“The bank’s capital base provides a strong foundation to embrace controlled growth in the coming year, with liquidity and eligible liquid asset ratios comfortably above the minimum levels prescribed by UAE Central Bank,” said van Linder.