Shuaa Capital has blamed low oil price and the challenges facing the small business sector in the UAE for the widening loss in its second-quarter results.
The Dubai-based investment bank reported a net loss of AED50.8 million, compared to a AED27.5 million loss in the first quarter. The firm posted a profit of AED1.7 million in the second quarter of last year.
Revenues dropped by 25 percent compared to the same period a year earlier, to AED44.6 million, and by 2 percent compared to the previous quarter.
Shuaa said that the decline was mainly due to AED56.9 million in provisions set aside by its SME lending unit, Gulf Finance, which reported a 10 percent drop in revenues to AED36.4 million.
“Shuaa’s second quarter performance is reflective of the ongoing volatility in global markets and the challenges facing the local SME sector,” the bank’s chairman, Abdul Rahman Hareb Rashed Al Hareb, said in a press statement.
“Sustained low oil prices coupled with a troubled Eurozone had a knock-on effect on regional markets’ performance.”
In June, Abu Dhabi Financial Group (ADFG) bought a 48.3 percent stake in Shuaa from Dubai Banking Group for an estimated AED360 million.For all the latest banking and finance news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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