Sharjah Islamic Bank 2023 net jumps 31% to record $229.11mln

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Sharjah Islamic Bank (SIB) registered robust growth, achieving a 31% surge in net profits to AED841.5 million ($229.11 million) in 2023, compared to AED650.9 million in 2022.

Operating profits also witnessed a 23% rise, reaching AED2 billion for 2023, up from AED1.6 billion in the previous year, a WAM report said.

The net income resulting from financing and investment products witnessed a significant increase of 20% to reach AED1.5 billion, an increase of AED239.6 million compared to the same period of the previous year in 2022, when it reached AED1.2 billion.

Commendable growth

Similarly, there was a commendable growth of 23% in net fees, commissions and other income, reaching AED275.5 million for the fiscal year 2023, in contrast to the AED224.2 million reported for the same period in 2022.

Meanwhile, general and administrative expenses registered a 12% increase, totaling AED684.1 million for the year ended 2023, compared to AED610.8 million for the preceding year. Noteworthy, however, is the enhancement of cost efficiency ratios through strategic policy measures, resulting in a notable improvement from 38% in the previous year to the current 35%. This highlights the Bank's commitment to prudent cost management practices.

In terms of SIB's risk management approach, the Bank has fortified its provisions, resulting in a reported impairment provision of AED439.0 million with an increase of 26.4%, compared to the previous year's provision of AED347.4 million.

increase in total assets

The SIB's statement of financial position indicates a notable 11% increase in total assets, reaching AED65.9 billion as of December 31, 2023, compared to AED59.1 billion on December 31, 2022.

Maintaining a robust liquidity position is a strategic priority for the Sharjah Islamic Bank, evident in the liquidity ratio standing at 21% of total assets or AED13.7 billion. Furthermore, the financing-to-deposits ratio, a key indicator of liquidity strength and stability, achieved a commendable 73%. These figures collectively underscore the Bank's sound financial footing and effective liquidity management.

The SIB has successfully diversified its financing portfolio across various economic sectors Total investments in Islamic financing have reached AED33.0 billion, indicating an 8% increase compared to the previous year-end figure of AED30.7 billion.

Customer deposits

Simultaneously, the SIB attracted a substantial volume of customer deposits in 2023, witnessing a remarkable 14.4% growth of AED5.7 billion. This surge elevated total deposits to AED45.2 billion, surpassing the AED39.5 billion recorded as of December 31, 2022.

Sharjah Islamic Bank boasts a robust capital base, with total shareholders' equity reaching AED8.1 billion as of 31st December 2023, constituting 12% of the Bank's total assets. This translates to a commendable capital adequacy ratio of 18.87% in accordance with Basel III standards.

The SIB has demonstrated enhanced profitability, with a notable improvement in the rate of return on average assets and average equity. These metrics stand at 1.36 and 10.81%, respectively, compared to 1.14 and 8.49% in the preceding year.

The Sharjah Islamic Bank's board of directors has proposed a 10% cash dividend, subject to approval at the upcoming general assembly meeting. This reflects the Bank's commitment to delivering value to its shareholders.