Sharjah Islamic Bank posts 26% profit rise, proposes higher dividend and capital increase

Sharjah Islamic Bank (SIB) has reported a 26 per cent rise in net profit for 2025 and proposed a higher cash dividend and a capital increase, underscoring strong growth across its core businesses.

Net profit after tax climbed to Dh1.32 billion, up from Dh1.05 billion in 2024, the bank said, supported by balanced expansion in financing activities and higher fee income.

Income from Islamic financing, investments and sukuk rose by Dh175 million, or 4.7 per cent, to about Dh3.9 billion, while distributions to depositors and sukuk holders increased to Dh2.3 billion from Dh2.2 billion a year earlier. The bank said this reflected its ability to sustain growth while maintaining stable, Shariah-compliant returns amid fluctuating funding costs and competitive pricing pressures.

Net fees and commission income jumped 50 per cent to Dh598.8 million, lifting total operating income by 14 per cent year on year to around Dh2.5 billion.

General and administrative expenses rose 15.2 per cent to Dh897.5 million, driven mainly by higher investment in staff development and technology. Despite this, operating income before impairment provisions rose 13.3 per cent to Dh1.6 billion, from Dh1.4 billion in 2024.

Net impairment charges on financial assets, after recoveries, stood at Dh217 million, broadly stable from Dh210.4 million a year earlier. The non-performing financing ratio improved to 3.8 per cent from 4.9 per cent, while the coverage ratio rose to 109 per cent from 99.5 per cent, reflecting stronger asset quality.

Total assets grew 14 per cent to Dh90.3 billion, driven by a 19.6 per cent increase in customer financing to Dh45.6 billion. Customer deposits rose to Dh55.7 billion from Dh51.8 billion, pushing the financing-to-deposit ratio to 81.8 per cent.

Liquidity remained strong at 22.3 per cent of total assets, or Dh20.2 billion. Profitability ratios improved, with return on average assets rising to 1.55 per cent and return on average equity to 14.78 per cent.

The board proposed raising the cash dividend to 20 per cent, from 15 per cent a year earlier, subject to shareholder approval. It also approved a plan to increase the bank’s capital, pending regulatory and shareholder consent, to support future growth and strengthen its capital base.