• Total Income increased by 5.8% year-on-year 
  • Total Assets increased by 8.7% year-on-year and by 6.8% year-to-date 

Dubai, UAE: - The National Bank of Ras Al Khaimah (RAKBANK) Group (“RAKBANK” or the “Bank”) has announced a consolidated net profit of AED 839.4 million for the nine-months period ended 30 September 2019, a growth of 24.9% year-on-year. The third quarter of 2019 generated a profit of AED 284.5 million, an increase of 18.5% year-on-year. The Gross Loans & Advances have grown by 4.3% year-to-date to AED 36.3 billion.

Commenting on the results, Peter England, CEO of RAKBANK, said: “We achieved another very good result with total income for the third quarter of 2019, exceeding AED 1 billion and net profit reaching AED 284 million, which was an 18.5% increase over the same period of last year. Looking at the year-to-date results, net profit increased by 24.9% to AED 839 million on the back of strong income growth and a continued reduction in provisions despite a challenging external environment. Total Income grew by 5.8% compared to the same period last year and stood at close to AED 3.0 billion for the first nine months of 2019. The stand out performer of the year continues to be fee income, with all business units recording solid growth in this area relative to their performance in 2018, leading to a 17.9% increase in this line. Our Gross Loans and Advances increased by 3.4% year-on-year, which was mainly driven by Wholesale Banking and Financial Institutions Group segments. Diversification of our balance sheet whilst retaining a firm commitment to the SME sector has been at the heart of our strategy over the last 5 years and the results of this continues to bear fruit in terms of sustained income growth and lower provisions.” 

Nine month 2019 financial highlights

  • Net Profit increased by 24.9% year-on-year
  • Total Income increased by increased by 5.8% year-on-year
  • Total Assets increased by 8.7% year-on-year
  • Improved asset quality resulted in a decline in provisions
  • Return on Assets stood at 2.1% and Return on Equity at 15.5%

Performance review

Total Income is AED 3.0 billion for the nine months ended 30 September 2019, which increased by 5.8% as compared to the same period of the previous year. Net Interest Income and Net Income from Islamic Finance for the first nine months of 2019 was AED 2.1 billion, growing by 1.2% year-on-year. Non-Interest Income improved by AED 138 million year-on-year to AED 907 million, mainly due to an increase of AED 74 million in Forex & Derivative income and AED 54 million in Fee & Commission income. Operating expenses increased 5.6% year-on-year and the cost to income ratio for the period closed at 39.2%.

Gross Loans & Advances increased by AED 1.5 billion to AED 36.3 billion, which is a rise of 4.3% year-to-date, which contributed to an increase of the Bank’s Total Assets by 6.8% to AED 56.3 billion compared to the end of 2018. Likewise, the Total Assets increases was also because of the growth of Bank placements of AED 1.2 billion and an increase in Investments by AED 0.9 billion. In addition, Customer deposits grew by AED 2.3 billion to AED 36.5 billion, a 6.8% growth compared to the end of 2018.

Asset quality

Impairment charge continued their downward trajectory from its peak in the third quarter of 2018. Impairments decreased by 9.9% (Q3 2019 Vs Q3 2018) which is a 6.3% decline year -on-year. The Non-Performing Loans and Advances to Gross Loans and Advances ratio closed the period at 3.7% compared to 4.2% as at 31 December 2018. RAKBANK is well provisioned against loan losses with a loan loss coverage ratio of 129.1%, excluding mortgaged properties and other realizable asset collateral available against loans.

Capitalization and liquidity

The Bank’s Total capital adequacy ratio as per UAE Central Bank regulations stood at 17.5% at the end of September 2019. The Common Equity Tier 1 ratio of the Bank stood at 16.4%. The regulatory eligible liquid asset ratio at the end of September 2019 was 12.2% well above the minimum requirement of 10.0%. The advances to stable resources ratio stood comfortably at 89.5% compared to 94.5% at the end of 2018.

England concluded: “On the innovation front we continue to develop market leading products and services such our ‘RAK Starter’ business account that is exclusively for start-up companies registered in the UAE. Additionally, the Bank partnered with Mastercard to offer its Business Banking customers access to an online payments gateway that is safe, simple and smart via a new portal called Simplify Commerce. We also revamped our RAKBANK Gold Account that offers our customers access to gold at extremely competitive rates, where they can buy or sell gold at anytime from anywhere in seconds using RAKBANK Gold Account, through RAKBANK’s Digital Banking App and continued to grow and develop our on-line real time remittance platform, ‘RAKMoneyTransfer’. We also made significant progress on our new Mobile Banking application which is due for release in the 4th Quarter of this year.”

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About RAKBANK             

RAKBANK, also known as The National Bank of Ras Al Khaimah (P.S.C), is one of the UAE’s most dynamic financial institutions. Founded in 1976, it underwent a major transformation in 2001 as it rebranded into RAKBANK and shifted its focus from purely corporate to retail and small business banking. In addition to offering a wide range of Personal Banking services, the Bank increased its lending in the traditional SME, Commercial, and Corporate segment in recent years. The Bank also offers Islamic Banking solutions, via RAKislamic, throughout its 36 branches and its Telephone and Digital Banking channels. RAKBANK is a public joint stock company headquartered in the emirate of Ras Al Khaimah and listed on the Abu Dhabi Securities Exchange (ADX). For more information, please visit www.rakbank.ae  or contact the Call Centre on +9714 213 0000. Alternatively, you can connect with RAKBANK via twitter.com/rakbanklive and facebook.com/rakbank.

For media enquiries, please contact:
RAKBANK
Geraldine Dagher
Geraldine@rakbank.ae 

© Press Release 2019

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