DUBAI - Dubai Islamic Bank (DIB), the United Arab Emirates' largest sharia-compliant lender, posted a 26 percent increase in third-quarter net profit on Wednesday as higher income from Islamic financing and investing offset a rise in impairment charges.
The bank made 1.11 billion dirhams ($302.2 million) in the three months to Sept. 30, it said in a statement. This compares with a profit of 876.3 million dirhams in the corresponding period of 2016.
EFG Hermes forecast the bank would make a quarterly profit of 1.02 billion dirhams.
Earnings were lifted by a 21 percent rise in net income from Islamic financing and investing transactions and an 8 percent jump in income from fees, commissions and foreign exchange. That helped offset a more than doubling of impairment charges.
DIB's earnings growth has been ahead of most of its local rivals in many of the recent quarters, despite a relatively tepid economic environment.
"With the solidity and resilience displayed by UAE's financial market, credit growth is expected to more than double to 5 percent in 2018," said Mohammed Ibrahim al-Shaibani, DIB's chairman, referring to average credit growth for the UAE banking industry.
DIB is targeting loan expansion in 2017 of between 10 to 15 percent, DIB Chief Executive Adnan Chilwan said in January, compared with actual 2016 loan growth of 18 percent. ($1 = 3.6729 UAE dirham)
(Reporting By Tom Arnold; Editing by Keith Weir) ((Tom.Arnold@thomsonreuters.com; +97144536265; Reuters Messaging: email@example.com))