Dubai: Sharjah Islamic Bank (SIB) on Wednesday reported a net profit of Dh405.8 million compared to Dh545.5 million for the year 2019, posting a decline of 25.6 per cent year on year.
The banks operating profits before provisions increased by 8.7 per cent, amounting to Dh697.7 million, compared to Dh642.1 million for the same period last year.
“The exceptional circumstances that the world is going through, the Bank has been prudent to hedge the potential risks owing to these difficult economic conditions and has made a provision on its financial assets amounting to Dh255.8 million, compared to Dh96.8 million from the last year,” SIB said in a statement.
The Board of Directors has proposed 8 per cent cash dividend of the paid-up capital.
Balance sheet growth
The balance sheet reflects the bank’s total assets of Dh53.6 billion at the end of December 2020, growing by 15.5 per cent compared to Dh46.4 billion at the end of 2019.
The bank continued to diversify its financing facilities portfolio in different economic sectors in accordance with its prudent credit policy that takes into consideration the effects of the prevailing market volatility and instability in global and regional capital market on banking operations. Financing facilities reached Dh29.3 billion, an increase of Dh4.1 billion or 16.4 per cent compared to Dh25.1 billion last year. Customer deposits increased by 23 per cent to reach Dh33.6 billion compared to Dh27.3 billion at the yearend 31 December 2019.
“The financial performance indicators showed the efficiency and flexibility of the organizational units across all sectors in the bank, as well as the high level of dedication and hard work. The very teams, that continued to provide their services to the bank’s clients, from institutions to individuals to small and medium scale companies without interruption, during this difficult period,” said Mohamed Abdalla, CEO of Sharjah Islamic Bank.
On the expenses side, general and administration expenses declined to Dh561.5 million at the end of 2020 compared to Dh585.4 million for the same period 2019, a decrease of Dh 16.2 million or 2.8 per cent, due to operational efficiencies achieved by the Bank.
Liquidity and capital
Liquid assets stayed strong at Dh11.2 billion or 20.9 per cent of total assets at the end of December 2020. Sharjah Islamic Bank has a strong capital base. Total shareholders’ equity at the end of December 2020 reached Dh7.6 billion, representing 14.3 per cent of the bank’s total assets with a strong capital adequacy ratio of 21.5 per cent according to Basel III requirements.
