A surge in foreign investment boosted the UAE Central Bank’s net earnings by 17 per cent in 2010 despite a decline in interest income, official data showed.
From around Dh3,184 billion in 2009, the Central Bank’s net profits swelled to nearly Dh3.721 billion in 2010, the bank said in its annual report.
The rise was caused by an increase in the bank’s investment income, which grew from about Dh3.843 billion in 2009 to Dh4.286 billion in 2010.
The surge followed a sharp rise in the bank’s held-to-maturity foreign bonds, which rocketed to around Dh68.1 billion at the end of 2010 from only about Dh36.7 million at the end of 2009, the report showed.
Total assets increased to nearly Dh228.9 billion from Dh203.9 billion while deposits by the central bank with other banks tumbled to Dh44.5 billion from around Dh85.6 billion in the same period.
A profit breakdown showed interest income shrank to around Dh368.5 million in 2010 from Dh470.6 million in 2009 while net interest and investment income increased to Dh3.996 billion from Dh3.613 billion.
Interest expenses dropped to nearly Dh656.9 million from Dh700.7 million while staff and administrative expenses fell to Dh338.1 million from Dh470.8 million.
“Following a difficult financial environment in 2009, 2010 saw earnings reaching Dh3.7 billion,” the Central Bank said in its 45-page report.
In a recent statement, the central bank’s board said it expected better performance in 2010 and 2011 over the previous year due to an improvement in global markets following the 2008 financial distress.
The board had projected earnings at around Dh3.67 billion in 2010 and Dh3.7 billion in 2011. Total revenue for 2011 was put at about Dh4.8 billion while expenses were projected at Dh1.11 billion.
A sharp fall in interest income depressed the Central Bank’s net profits by 14.4 per cent in 2009 but its investment income more than doubled through the year.
From Dh3.722 billion in 2008, the Central Bank’s net income dipped to Dh3.184 billion in 2009, the central bank had said Bank said in its 2009 report.