UAB posts 166% growth in net profit on resilient business strategy

Sharjah-based lender attributes growth in net profit to improved operating performance and lower expected credit losses and a prudent approach to risk management

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UAB total Income increased by four per cent comparing to the same period in 2021. — Supplied photo
by

A Staff Reporter

Published: Wed 9 Nov 2022, 4:44 PM

Last updated: Wed 9 Nov 2022, 4:45 PM

United Arab Bank (UAB) has announced a net profit of Dh119 million for the first nine months of 2022, an increase of 166 per cent over the corresponding period of 2021, which exhibits its resilient business strategy.

United Arab Bank (UAB) on Wednesday said its net profit surged 166 per cent to Dh119 million during the first nine months of 2022 due to its resilient business strategy.

In a statement, the Sharjah-based lender said the growth in net profit is a result of improved operating performance and lower expected credit losses and a prudent approach to risk management which resulted in lower cost of risk.

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UAB’s financial performance was aided by a significant progress within the ‘core’ businesses recording a seven per cent increase in operating profit compared to the first nine months in 2021. Total Income increased by four per cent comparing to the same period in 2021.

The balance sheet has been significantly strengthened with focus on quality assets which resulted in recording 57 per cent reduction in Provisions compared to the first nine months in 2021. These results provide further evidence that the Bank is well positioned to set sail on its growth journey.

“We are pleased with the financial performance of the bank for the first nine months of 2022. The bank returned to profitability due to the execution of an effective strategy. The bank is moving ahead according to a well-thought-out strategy that supports growth and shareholders' expectations,” Sheikh Faisal bin Sultan bin Salem Al Qassimi, chairman of the board of directors, UAB, said.

“We are confidently looking forward to the future and continuously developing our business model and activities in line with our sustainable growth strategy in the UAE,” he said.

Shirish Bhide, chief executive officer of UAB, said: “We will pursue our ambitious vision relentlessly and accelerate the pace of investments in our growth strategy whilst upholding the highest standards of compliance and internal controls commensurate with the dynamic regulatory framework and cyber security requirements.”

He added: "Our customers remain at the heart of our growth strategy, and we will continue to invest in developing the bank’s digital platforms to increase competitiveness and create a more efficient, resilient and seamless service at a pace that suits our customers’ expectations.”

KEY TAKEAWAYS

> 4% growth in total operating income in Q3 YTD 2022 as compared to Q3 YTD 2021

> Operating Profit increased by 7% vs Q3 YTD 2021

> Provisions for Credit Losses decreased by 57% vs Q3 YTD 2021

> Adequate liquidity profile with UAB comfortably above regulatory requirements

> An advances to stable resources ratio of 88% and an eligible liquid asset ratio of 17%

> Capital remains above regulatory requirements with CET1 ratio at 12.3% and Capital Adequacy Ratio (CAR) at 13.5%

> Provision coverage reported at 123% whereas NPL ratio has reduced to 10.3% from 14.4% in Q3 2021

— muzaffarrizvi@khaleejtimes.com

A Staff Reporter

Published: Wed 9 Nov 2022, 4:44 PM

Last updated: Wed 9 Nov 2022, 4:45 PM

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