FGB Q2 profit jumps 16% on higher non-interest revenues

FGB on Tuesday said its 2014 second-quarter net profit climbed 16 per cent to Dh1.35 billion on higher non- interest revenues.

In a statement, the bank said its performance during first half of 2014 was driven by strong balance sheet, yielding solid and diversified revenues, improved asset quality metrics and enhanced profitability.

FBB’s loans and advances recorded six per cent increase to reach Dh128.2 billion. — Supplied photo

FGB’s income diversification strategy provided positive results. The new record revenue of Dh2.288 billion represented 13 per cent year-on-year growth in the second quarter, the statement said.

“Net interest and Islamic financing income also increased by 12 per cent to Dh1.647 billion in the April-June period.

This was primarily the result of improving net interest margin at 3.7 per cent and higher loan balances as loans and advances grew four per cent during the quarter,” it said, adding that non-interest revenues also rose by 18 per cent to Dh641 million, including higher contribution from the subsidiaries.

The bank further said loans and advances recorded six per cent increase and reached at Dh128.2 billion. It also noted double-digit growth of 11 per cent in customer deposits to Dh137.5 billion while assets grew by seven per cent to Dh198.2 billion in the second quarter.

The Abu Dhabi-based lender’s first-half financial results showed continued and solid performance across all business lines, with earnings reaching at Dh2.680 billion, reflecting a year-on-year increase of 21 per cent. The revenues increased by 17 per cent to Dh4.539 billion and net interest and Islamic financing Income grew by 15 per cent to Dh3.247 billion in January-June 2014 period, the bank said.

Abdulhamid Saeed, FGB managing director, said the strong results reflect the effectiveness of FGB’s strategy to expand and drive the business forward.

“Exactly one year ago, we reshaped our businesses into three core pillars: Wholesale Banking Group, Consumer Banking Group and the Treasury & Global Markets Group. This allowed us to significantly enhance synergies between our core businesses, deepen our expertise and our product offering across a number of areas, and improve our overall value proposition,” he said.

The lender has successfully integrated both subsidiaries ‘Dubai First’ and ‘Aseel Islamic Finance’ into its existing operations, which has strengthened the business and enabled it to better, meet the needs of its customers.

André Sayegh, chief executive officer of FGB, said: “This recognition highlights FGB’s outstanding achievements throughout the past year. The solid performance in the first half of 2014 is a continuation in this direction.”

“Our recent rebrand also signifies our aspirations and clear plan to position FGB for long-term sustainable success in the UAE and across geographies,” he added.

In addition, he said the recent inclusion of FGB stock in the MSCI Emerging Market Index reaffirms “our leadership and our commitment” to pursue our efforts towards maximising returns for all our stakeholders.

— haseeb@khaleejtimes.com