RAKBank has sighted a turnaround based on its second quarter numbers. There was solid growth in fees, but interest income disappointed. Image Credit: Supplied

Dubai: In line with other leading UAE banks, RAKBank delivered a strong run in the second quarter, with net profit at Dh192.1 million and a 25.4 per cent increase on last year. For the first six months, the Ras Al Khaimah headquartered bank had total income at Dh1.6 billion.

“This is a crucial turning point for us as we see growth in our loan book and customer deposit, and that is a very positive sign,” said Peter England, CEO. “Additionally, our provisions for this quarter are the lowest they have been for many years as we see the re-balancing of our portfolio, which we have undertaken over the years, bear very positive results.

“It also demonstrates the significant rebound in the UAE economy and a strong return of consumer confidence that we have witnessed during the first half of this year.”

As of June 30, total assets were Dh54.3 billion, up by 2.9 per cent year-to-date and an increase of 2 per cent compared to the first quarter of 2021. The numbers show the bank putting some distance between the disruptions of 2020, when the outbreak of the pandemic injected multiple uncertainties for the sector and the wider economy.

“We have seen total income commence growth again after a number of quarters of decline since the beginning of the pandemic,” the CEO added.

A decline

Total income for the first-half of 2021 dropped by 14.2 per cent to Dh1.632 billion. “This is mainly due to a decrease in net interest income and net income from Islamic products by Dh287.9 million, that was partially offset by an increase of Dh16.7 million in non-interest income,” the bank said in a statement.

“Non-interest income increased 3.1 per cent to Dh557.9 million because of the year-on-year increase of Dh20.0 million in net fees and commission income and Dh28million in investment income.”

But the forex and derivative income declined Dh23.1 million as well as a Dh10 million drop in gross insurance underwriting profit.