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Union National Bank reports Dh833.3m nine-month profit

ABU DHABI — Union National Bank (UNB) achieved a net profit of Dh833.3 million for the first nine months up to September 2007 as compared to Dh833.6 million for the corresponding period of 2006.

The results are strong, given that income from capital market related activities was included in 2006, which has not been the case so far in 2007.

On a core business comparative basis, the bank's net profits have risen by 45 per cent over this period.

The net profit for the three months period ended September 30, 2007 was Dh295.2 million, compared to Dh206.3 million for the same period in 2006, representing an increase of 43.1 per cent quarter-on-quarter reflecting solid growth in business and income from the core banking activities.

The net loans and advances have grown by 36.4 per cent to reach Dh35.0 billion as of September 30, 2007 (September 30, 2006: Dh25.7 billion) on the back of sustained deal generation.

The bank was actively involved in the area of loan syndications. Customers' deposits grew to Dh31.4 billion (September 30, 2006: Dh25.8 billion), an increase of 22.1 per cent and along with an increase in medium term borrowings, supported the asset growth.

These increases contributed to the consolidated total assets as at September 30, 2007 reaching Dh46.4 billion as compared to Dh36.1 billion for the same period last year, an increase of 28.7 per cent.

The return on average assets of 2.6 per cent and return on average equity of 18.2 per cent for the period ended September 30,2007 remained satisfactory.

The operating expenses increased by 27.7 per cent for the nine month period ended September 30, 2007 as compared to the corresponding period last year mainly due to the consolidation effect of the group's new subsidiaries (Al Wifaq Finance Company and Alexandria Commercial and Maritime Bank) and the ongoing investment in the infrastructure and branch expansion to offer a superior customer experience. The efficiency ratio (cost to income) was well contained at 29.6 per cent.

Mohammad Nasr Abdeen, Chief Executive of the Bank stated, "The solid results over the three quarters are a re-affirmation of our strategy to pursue focussed growth in our home market (UAE) while following a controlled regional expansion programme that should be value accretive for our stakeholders."