Mashreq, the Dubai lender controlled by the Al Ghurair family, posted a higher profit during the third quarter of this year, underpinned by a strong capital and liquidity position.
The company declared a net profit of Dh180m ($50m) in three months to the end of September, compared to a net loss of Dh183m during the same period last year, the lender said in a statement to the Dubai Financial Market, where its shares are traded. It was more than three-fold up on a quarterly basis.
The UAE national economy has returned to growth, providing new opportunities for Mashreq across all lines of business, Abdul Aziz Al Ghurair, chairman of Mashreq, said in a statement on Tuesday.
Despite a conservative risk strategy, the bank has been able to deliver “robust growth and maintain a comfortable liquidity position, providing fiscal headroom to continue to invest in our most vital asset, our people”.
In the first nine months of the year, Mashreq's net profit declined almost 25 per cent on an annual basis to Dh265m. Its impairment allowance stood at Dh2bn in the January-September period, a yearly increase of almost 25 per cent.
Mashreq’s customer deposits jumped to Dh94.8 billion, surging 7.4 per cent from Dh88.3bn by the end of last year. The lender’s total assets grew 7 per cent to Dh169.6bn as of September 30, from Dh158.5bn by the end of last year.
“Skills development and the encouragement of digital innovation are embedded in our corporate strategy and remain critically important as we build market share to benefit our employees, customers and shareholders,” Mr Al Ghurair said.
Mashreq's operating profit reached Dh737m in the third quarter, an annual increase of 44 per cent as a result of increased operating income, the bank said. It was Dh2.4bn for the nine-month period.
“This [operating profit] is generated mainly from a 26.2 per cent increase in fee and commission income. These financial outcomes reflect not only the bank’s fiscal resilience but a sustained economic recovery at home and abroad,” said Ahmed Abdelaal, group chief executive of Mashreq.
“A growing sense of consumer and business confidence within the region has also supported strong growth across Mashreq’s loan portfolio,” he added.
The lender's loans and advances increased by 7.6 per cent year-to-date to Dh77bn and its loan-to-deposit ratio remained stable at 81.2 per cent at the end of September.
“We believe that progress cannot be made without the development of a diverse, inclusive and enabling working environment. The successful adoption of our ‘work from anywhere’ culture, which we rolled out in 2021, is one such step in this direction,” Mr Abdelaal said.