DIB posts Dh1.1b Q1 net profit

GOOD PERFORMANCE: DIB delivered profitable results amidst an extraordinary global economic environment.

Dubai Islamic Bank (DIB), the largest Islamic bank in the UAE, announced on Thursday that it achieved a first-quarter a net profit of over Dh1.1 billion supported by robust total income despite creating additional provision and buffers of nearly Dh1.5 billion.
In a statement, DIB said it continues to deliver profitable results amidst an extraordinary global economic environment. The bank's total Income rose to Dh3.559 billion from Dh3.407 billion in Q1 2019.
"The first quarter profitability has been achieved despite a deliberate, conservative and prudent approach adopted by the bank to create additional provisions and buffers of nearly Dh1.5 billion (offsetting the over a billion dirham gain on bargain purchase of Noor Bank) to manage the impact, if any, of the Covid-19 pandemic, as well as lower oil prices and interest rate," DIB said.
Cost to income ratio stood at 29.8 per cent without synergies expected from Noor Bank acquisition yet to materialize over the course of the year as total assets grew 19 per cent to Dh276.4 billion. Customer deposits increased 22 per cent to Dh 199.9 billion. The bank's capital adequacy ratio is currently at 16.5 per cent while CET 1 ratio is at 12.1 per cent, said the statement.
Mohammed Ibrahim Al Shaibani, Director-General of His Highness The Ruler's Court of Dubai and Chairman of Dubai Islamic Bank, said the UAE banking sector has acted quickly to provide essential support towards the banks and the customers with various relief and stimulus measures amounting to more than Dh70 billion, executed in line with regulatory guidance. "At DIB, we remain committed to such initiatives undertaken by our government and continue to cooperate and work hand in hand with the appropriate authorities to protect the community and the market."
"Over the past few months, countries across the globe have been experiencing unprecedented times, as they come together to combat the current global pandemic. Thanks to the strong leadership of the UAE, the country has taken an inspiring and decisive approach by promptly implementing various health and safety measures as well as economic reforms to ensure that our business and services continue to operate optimally in the current environment," said Al Shaibani.
DIB Managing Director, Abdulla Al Hamli, said safety and security of bank's employees and customers remained top priority. "In this respect, we have implemented a variety of measures across the organization ranging from technology based work from home platforms for staff, to creating awareness on the health and safety, to ensuring appropriate and optimal management of branches and express centers from hygiene and cleanliness perspective, all in line with guidance from authorities."
Dr. Adnan Chilwan, Group Chief Executive Officer, said 2020 has started in a rather explosive manner. "The Covid-19 pandemic is destined to create significant headwinds and force a rethinking and recalibration of our strategies. Difficult decisions may need to be made in the short term to ensure that we return to normalcy in the fastest possible manner."
"The recent shareholders' approval on the increase in FOL (foreign ownership limit ) to 40 per cent for DIB will have a fundamental positive impact for DIB primarily through the increased weightings in global and regional indices. This is a major milestone and a clear testament to the fact that the Board and management of DIB remain committed to the shareholders and focused on ensuring that returns continue to be optimized," said Chilwan. - issacjohn@khaleejtimes.com

Issac John

issacjohn@khaleejtimes.com