Tamweel profits rise 43% on cost reductions

Tamweel profits increase amidst reduction of provisioning.

The Islamic lender Tamweel yesterday announced a 43 per cent rise in net profit for last year, thanks to cost reductions and lower impairment provisions.

The lender, 86.45 per cent owned by Dubai Islamic Bank, announced net profit of Dh103.9 million for 2013, equivalent to 10 fils per share, compared with Dh72.5m the previous year.

Tamweel has proposed a dividend of 5 fils per share, unchanged on the previous figure.

The increase in profits comes despite a decrease in the lender’s Islamic financing and investing assets to Dh7.68 billion, a year-on-year fall of 17.7 per cent, and a 9 per cent fall in operating profit.

Net profit increased as Tamweel trimmed its depositors’ and investors’ share of profit and related costs by 17 per cent as DIB settled about Dh4bn worth of liabilities two years ahead of schedule.

The outstanding obligations comprised liabilities that were part of a five-year moratorium agreed with the lender’s creditors in late 2010 that were due to mature in 2015.

DIB increased its stakeholding in the bank to 86.45 per cent in March last year, taking the company private in October.