UAE's Rakbank reports 13% growth in Q1 profits

PROFIT RISE: The bank will continue to invest in technology and other delivery channels, Rakbank says. (Getty Images)

National Bank of Ras Al Khaimah, or Rakbank has reported a net profit of AED160.37m ($44m) for the first quarter of 2009, a 12.7% increase over the same period last year.

"The bank's performance during the quarter, which ended 31st Mar 2009, remains positive despite adverse market conditions, with the personal banking portfolio continuing to grow in line with the bank's targeted expansion," the retail bank said in a media release.

The bank's net interest income increased by 34% from the same period last year to reach AED248m. Gross loans and advances stood at AED11.9bn, a five percent increase over end of year 2008 and a 30% increase over the first quarter last year. Fee, commission and other income at AED 118 million was marginally up compared to the same period last year.

"Rakbank has continued to actively seek new lending opportunities and has seen growth in a number of segments, including those of small businesses, personal loans, mortgages and credit cards," said Graham Honeybill, General Manager.

"Despite interbank rates easing, the cost of customer deposits has remained high, and this has impacted the level of profitability this year, compared to what the bank has seen in previous years," he explained.

"Nevertheless, and in spite of the market's challenging conditions, Rakbank's business has registered very healthy growth in the first quarter across its product offering."

The bank will continue to invest in technology and other delivery channels, Honeybill added.

The bank remains at the forefront of Emiratisation in the banking industry, the media release said.

The bank's capital adequacy ratio at the end of the quarter stood at 16.45%, against a minimum of 10% as prescribed by the UAE central bank. Total assets at the end of the quarter were AED14.5bn, a four percent increase from the end of 2008 and a 23% increase compared to end of the first quarter last year. The growth in assets was mainly due to a rise of AED600m in loans and advances, the bank informed.

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