United Arab Bank, the Sharjah-based lender, reported a profit in the first quarter following a massive loss in the last three months of last year because of bad loans.
Still, despite the turnaround, the bank’s first-quarter profit fell by 72 per cent year-on-year. Net income declined to Dh45 million in the first quarter from Dh161.5m in the same period last year. The bank had a net loss of Dh238m in the fourth quarter of last year.
“These positive results provide tangible support that our new strategy is taking shape,” said Samer Tamimi, the bank’s acting chief executive.
“Whereas our return to profitability has been aided by a reduction in provisions and cost savings associated with a comprehensive cost structure review, I am satisfied that we have recorded significant progress in the core business engine itself.”
UAB booked a total loss of Dh166m last year as bad debts piled up after years of risky lending to SMEs unravelled in the economic downturn that was triggered by a crash in the price of oil. However, cracks in UAB’s operations appeared in earnest during the third quarter of last year, when the bank lost Dh272.6m compared with a profit of Dh169.2m in the same quarter of 2014.
Elsewhere, Commercial Bank of Dubai said yesterday that its first-quarter net income dropped by 18 per cent on impairments. Its net income in the first three months dropped to Dh241m from Dh295m in the year-earlier period.
mkassem@thenational.ae
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