Dubai: National Bank of Ras Al Khaimah (RAKBank) on Monday reported a consolidated first-half net profit of Dh554.9 million, up 28.5 per cent year-on-year.
For the second quarter, the bank posted a net profit of Dh284.8 million increasing by 25.7 per cent compared to Q2 2018. On a quarter-on-quarter basis, net profit improved by 5.4 per cent.
Total loans & advances grew 1.4 per cent year-to-date, reaching Dh35.3 billion, with lending growth delivered by the Wholesale and retail banking portfolios. Total deposits at Dh38.9 billion, up by 13.9 per cent year-to-date
“It has been a very strong first half for 2019. Whilst loan growth has been challenging in our Personal Banking and SME segments due to market conditions, we continue to see good traction in our Wholesale and Financial Institutions Businesses,” said Peter England, CEO of RAKBank.
Total income of Dh2 billion for the six months ended 30 June 2019 improved by 7 per cent on the same period in 2018. Net interest income and net income from Islamic Finance for the first half of 2019 was Dh1.4 billion, growing by 1.6 per cent year-on-year. Non-Interest Income improved by Dh108.3 million year-on-year to Dh614.2 million, mainly due to an increase of Dh56.9 million in forex & derivative income and Dh44 million in fee & commission income.
“Our outlook for the coming periods remains positive, as we continue to focus on boosting the performance of individual business units, while at the same time innovating to roll-out a more diverse range of products, services and solutions. We are looking forward to launching a number of new initiatives during the second half of this year,” said England.
Bank’s operating expenses increased by 5.1 per cent year-on-year and the cost-to-income ratio dropped to 39.1 per cent compared to 39.9 per cent in H1 2018.
RAKBank is well provisioned against loan losses with a loan loss coverage ratio of 131.8 per cent, excluding mortgaged properties and other realizable asset collateral available against loans. Impairments maintained a downward trajectory, declining by 9.9 per cent on the previous quarter.
“In terms of asset quality, we continue to see a reduction in the non-performing loans to gross loans and advances ratio that closed the period at 3.7 per cent, while our increasingly diverse revenue streams are demonstrated by growth in fee and commission income of Dh44 million compared to H1 2018 and an increase of Dh 56.9 million in Forex and Derivative income. Our strategy remains focused on achieving diversification in our business,” said England.