Mashreq reported on Wednesday a 14.1 per cent drop in revenue to Dh5.1 billion and a loss of Dh1.3 billion in 2020 as a direct result of lower operating income and higher risk charges.
The decline in revenue is mainly driven by the low interest rate regime, the impact of the pandemic and slower economic activities as a result of the lower oil prices, the bank said.
Capital adequacy ratio of the bank stood at 16 per cent and Tier 1 capital ratio at 14.9 per cent. “We proactively managed our liquidity position throughout the year and have consistently taken a conservative approach to our liquidity position,” Mashreq said.
Abdulaziz Al Ghurair, chairman of Mashreq, said Covid-19 has been both a significant disruptor as well as a catalyst for positive change in business operations. “The pace of vaccine rollout in the UAE as well as in other countries provides us with cautious optimism that the regional and global economies will steadily recover as the year progresses, fuelling future growth.”
Al Ghurair said during these unprecedented times, “our focus throughout has been to work closely with our clients, and colleagues, delivering uninterrupted services, consistency of standards and the safest possible working environment. I am very proud of how our people have risen to the challenge, and gone above and beyond for all our clients.”
In 2020, the bank focused on enhancing its already advanced digital transformation, delivering innovative digital, AI and data-centric solutions, and completely new propositions for our clients. “We also continued to invest in fundamental programmes that will position this bank for long term growth, as our industry changes shape around us, and to keep pace with the technologies that drive us forward. I firmly believe this is the right strategy, for our shareholders, for this country, and for our clients.”
Ahmed Abdelaal, group CEO, Mashreq Bank, said in 2020, the bank actively managed its position and took a prudent approach to safeguard Mashreq’s position, while doing everything in our power to help our customers prosper. “We expect to see a challenging first half in 2021, but are cautiously optimistic for a recovery in the second half.”
“As we look forward, it is important to recognise that the future of banking is rapidly merging with the trajectory of technology. We believe investments in our digital platforms and operating model will deliver sustainable savings in the long term, and position us strongly for this existential change impacting our industry,” said Abdelaal.
He said Mashreq will continue to focus on customer-centricity, which will fuel future growth. “We will continue to invest in strategic digital fundamentals, which deliver sustainable efficiencies and growth.”
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