Mashreq has reported a net profit of Dh1.3 billion for the year ended December 31, 2012, a 60 per cent increase on the previous year.
The bank's Total Operating Income for 2012 was Dh4.1 billion, representing a 5.5 per cent increase relative to 2011, while Q4 2012 Operating Income increased by 10.1 per cent on a Q-on-Q basis to reach Dh1.1 billion; As compared to Q4 2011, Operating income grew by 29.4 per cent. The annual increase is on the back of fee income and investment income.
Net fee and commission income recorded a growth of 20.8 per cent as compared to 2011 while Investment Income for 2012 climbed by 131.6 per cent. Mashreq’s Net Fee, Commission and Other Income to Operating Income ratio further improved from 49.8 per cent in 2011 to a high of 53.4 per cent in 2012.
General and Administrative expenses for 2012 increased by 3.4 per cent over the previous year to reach Dh1.9 billion.
Earnings per share increased from Dh4.85 in 2011 to Dh7.76 in 2012.
The board has proposed a cash dividend of 38 per cent subject to Central Bank and shareholder approval.
Abdul-Aziz Al Ghurair, Chief Executive Officer of Mashreq, commented on the year-end results: “2012 has been a watershed year, both for the UAE economy at large and the bank. Mashreq has made an impressive showing on all the essential performance parameters - Operating Income, Net Profit and in the reduction of provisions. I believe that the UAE Banking industry is poised for a strong comeback from the rough patch that it passed through in the recent past. The recovery of the banking sector bodes well for the overall economy and will restore the nation to the growth path that it has been pursuing.”
Mashreq’s Total Assets witnessed a moderate decline of 3.6 per cent, reaching Dh76.4 billion compared to Dh79.2 billion at the end of 2011. Liquid Assets to Total Assets stood at 27 per cent at the end of 2012, with Cash and Due from Banks at Dh20.9 billion.
Loans and Advances grew by 9.9 per cent in 2012 to reach Dh41.4 billion at year end, compared to Dh37.7 billion at the end of 2011.
During 2012, the bank grew its deposit base leading to a 4.5 per cent increase in customer deposits compared to 2011, reaching Dh47.5 billion. A higher growth in loans versus deposits led to an optimum level of Loan-to-Deposit ratio of 87 per cent in December 2012, and Loan-to-Total Asset ratio improved from 48 per cent to 54 per cent.
Mashreq's Provisions for Loans & Advances decreased by 31 per cent as compared to 2011 and stood at AED826 million at the end of 2012. The bank's efficiency ratio improved during 2012 to reach 45.4 per cent by the end of the year.
The bank’s Capital Adequacy stands at a healthy 19.3 per cent in 2012, while Tier 1 capital ratio improved to reach 17.2 per cent at year end.
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