Dubai Islamic Bank (DIB), the United Arab Emirates' largest sharia-compliant lender, posted an almost 14 percent increase in second-quarter net profit, above analysts forecasts, on the back of strong income from Islamic financing.

The bank made 1.06 billion dirhams ($288 million) in the three months to June 30, it said in a statement. This compares with a profit of 928.9 million dirhams in the corresponding period of 2016.

EFG Hermes had projected a net profit of 979 million dirhams and Arqaaam Capital had forecast 972 million dirhams as net profit for Dubai Islamic.

Earnings were lifted by an 18 percent increase in net income from Islamic financing, however income from fees, commissions and foreign exchange dropped 7.7 percent.

During the quarter, net impairment charges more than doubled from a year earlier to 186.5 million dirhams.

($1 = 3.6729 UAE dirham)

(Reporting by Saeed Azhar; Editing by Tom Arnold)