Mashreq, one of the leading financial institutions in the UAE, today reported a net profit of Dh2.1 billion ($571.69 million) for 2018, a 0.4% increase year-on-year.
Mashreq’s best-in-class non-interest income to operating income ratio remained high at 38.7% during the year, the bank said.
Impairment allowance was down by 17.3% YoY, insurance, FX and other income was up by 10.7% during the year.
The bank’s balance sheet had a solid growth with total assets growing by 11.8% to Dh139.9 billion, while loans and advances increased by 10.4% to reach Dh69.3 billion as compared to December 2017. Customer deposits grew by 9.4% in the year to reach Dh83.2 billion. Loan-to-Deposit ratio remained robust at 83.2% at the end of December 2018.
Liquid Assets ratio stood at 33.2% with cash and due from banks at Dh43.2 billion as on December 2018. Capital adequacy ratio and Tier 1 capital ratio continued to be significantly higher than the regulatory limit and stood at 16.5% and 15.3%, respectively.
The bank adopted a conservative dividend policy, with proposed dividend of only ~34% of net profit, for internal capital generation to support business growth.
Non-performing loans to gross loans ratio increased slightly to 3.1% at the end of December 2018. Total provisions for loans and advances reached Dh3.6 billion, constituting 137.2% coverage for non-performing loans.
Mashreq's CEO Abdul Aziz Al Ghurair said: “2018 was a year of further innovation at Mashreq. We are employing the latest technology and with this digital enablement we are re-imagining customer journeys to ensure they are smoother and better than ever. Furthermore, we are well on our journey of change and our agile transformation continues; we are working to expand it across other units.
“As all of you are aware, 2018 was a difficult year due to market fluctuations, however we rose to the challenge and managed to sustain our revenues. Much of this can be attributed to the bank’s focus on strategically acquiring good assets and growing the loan portfolio, whilst increasing its funding base. Improved risk management helped us reduce our Impairment Allowance by 17.3% year-on-year and what also helps is our strong liquidity and capital position, which enables us to seek and capitalize on future growth opportunities.”
Al Ghurair concluded: “Finally, it gives me great pleasure to inform you that Mashreq has been awarded the Gallup Great Workplace Award for a fifth year in succession. The importance of this achievement cannot be understated as only 39 organizations across the globe received this prestigious award in 2018. This recognition makes me proud to lead a company that has firmly established itself as a truly innovative and elite workplace.” - TradeArabia News Service
