Emirates Islamic’s net profit rises Emirates Islamic’s net profit rises

Emirates Islamic’s net profit rises to AED 1.2 billion for the first half of 2023

Dubai, 27 July 2023: Emirates Islamic delivered its highest ever half-year net profit, with an exceptional jump of 73% to AED 1.2 billion during the first half of 2023. This record profit was driven by higher funded and non-funded income reflecting improved business sentiment.

Total Income
AED 2.340 billion
↑71% y-o-y		 Expenses
AED 968 million
↑63% y-o-y		 Provisions
AED 160 million
↑113% y-o-y		 Net Profit
AED 1.212 billion
↑73% y-o-y
Net Profit Margin
4.74 %		 Cost: Income Ratio
41.4 %		 NPF Ratio
7.2 %		 CET-1 Ratio
19.0 %

Key Highlights – First Half 2023

Strong operating performance on higher funded income and higher non-funded income

  • Total income up 71% y-o-y driven by higher funded and non-funded income
  • Expenses increased 63% y-o-y as the bank invests for future growth
  • Impairment Allowances benefit from strong recoveries, delivering a healthy 60 basis point cost of risk
  • Operating profit improved 77% y-o-y
  • Net profit sharply increased to AED 1.212 billion on the back of higher funded income and higher non-funded income
  • Net profit margin at 4.74% following stable profit rates in the first half of 2023

Strong capital and liquidity combined with a healthy deposit mix enabling the Bank to provide improved products to customers

  • Total assets at AED 79 billion, increased 6% from end 2022
  • Customer financing at AED 51 billion, increased 5% from end 2022
  • Customer deposits at AED 58 billion, increased 3% from end 2022 with Current and Saving Account balances at 77% of deposits
  • Credit Quality: Non-performing financing ratio at 7.2% with Coverage ratio strong at 120%
  • Capital: Common Equity Tier 1 ratio at 19.0% and Capital adequacy ratio at 20.1% reflect the strong capital position of the Bank
  • Headline Financing to Deposit ratio at 88% remained within the management’s target range

Hesham Abdulla Al Qassim, Chairman said:

  • “Emirates Islamic delivered a record set of financial results, with a net profit of AED 1.2 billion for the first six months of 2023.
  • Total income was up 71% driven by higher funded and non-funded income, leading to operating profit growing strongly by 77% over the comparable period in 2022.
  • Emirates Islamic has always played an integral part in the UAE’s development and we are committed to contributing substantially to the economy’s growth by providing innovative Shariah-compliant banking solutions to our customers.
  • Demonstrating Emirates Islamic’s commitment to deepening the liquidity of the local currency sukuk market, Emirates Islamic issued the first dirham sukuk from a UAE bank, with a hugely successful AED 1 billion dirham-denominated sukuk. The sukuk issue sets an important precedent, expanding financing options for UAE corporations with Shariah-compliant needs while enhancing the development of the medium-term dirham yield curve.
  • In recognition of Emirates Islamic’s strong performance and market-leading product offering, we are honoured to be awarded the ‘Most Innovative Sukuk’ award at The Banker Islamic Banking Awards for our AED 1 billion dirham-denominated sukuk and ‘Best Islamic Real Estate Deal’ at the prestigious Euromoney Islamic Finance Awards 2023 for facilitating a real estate financing deal for a leading Dubai-based conglomerate.”

Salah Mohammed Amin, Chief Executive Officer said:

  • “Emirates Islamic’s balance sheet grew by 6% to AED 79 billion during the first half of 2023, maintaining a trend of successful asset growth.
  • Strong capital and liquidity combined with a healthy deposit mix enable the Bank to support customers in fulfilling their banking requirements.
  • We have witnessed strong growth across the Retail, SME and Corporate segments as the Nation’s economy continues to be buoyant.
  • In line with the Bank’s commitment to drive innovation in the Islamic banking sector, Emirates Islamic partnered with the Arab payment system, Buna, to enhance and facilitate cross-border transactions throughout the Arab region.
  • Emirates Islamic launched the new Emarati Absher Business Account, designed exclusively to provide a comprehensive suite of premium banking solutions for Emarati start-ups. This innovative account supports small and medium-sized businesses, owned by UAE citizens, through special support programmes and initiatives, and aligns with the UAE’s strategy to develop this important sector.
  • In our efforts to expand the footprint of Islamic banking in the UAE, and to promote a savings culture, we recently enhanced our flagship Kunooz Savings Account, offering customers an opportunity to win AED 1 million every quarter or a Mercedes EQS car every month or AED 10,000 every week.”