UAE's RAK Bank 2012 profit up 16.6%

Yearly profit hits US$381m, with 10.4 percent growth in loans and advances
RAK Bank
By Shane McGinley
Sun 27 Jan 2013 04:39 PM

The National Bank of Ras
Al-Khaimah (RAK Bank) reported net profit last year rose 16.6 percent
year-on-year to AED1.4028bn (US$381m), the UAE lender announced on Sunday.

The bank’s interest income grew
by 12.5 percent year-on-year to AED2.23bn, on the back of a 10.4 percent growth
in loans and advances, which stood at AED20.3bn over the 12 months of 2012.
Overall revenues climbed 9.7 percent to AED2.9bn.

“2012 marks a very successful
year for RAK Bank,” said Graham Honeybill, CEO.
“Not only did it see the bank’s implementation of its revamped core banking
system, but 2012 also witnessed the preparations for the launch of RAK Bank’s
Islamic Banking window.”

The bank’s conservative approach
to lending helped credit losses to fall 30 percent year-on-year, meaning
non-performing loans remained steady, accounting for 2.5 percent of gross loans
on its books at the end of 2012.

Deposits grew 13.3 percent to
AED20.7bn which, while costs also rose 13 percent on the bank of new
branches in Sharjah and Abu Dhabi and over 50 additional ATMs.

The rise in profits and revenue
meant the back was able to pay back AED684m in startup debt to the Ministry of
Finance.

Based on these results, the
lender’s directors have recommended a stock dividend of 10 percent and a cash
dividend of 40 percent, while 56 percent of the net profit will be retained.

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