Bank of Sharjah posts 6% rise in H1 profit

The bank’s loans and advances reached Dh13,947 million, eight per cent above the 2013 figure of Dh12,895 million. — KT file

Bank of Sharjah announced its financial results on Thursday for the first six months of the year, showing loans and advances had reached Dh13,947 million, eight per cent above the corresponding 2013 figure of Dh12,895 million, and six per cent more than the December 31, 2013, balance of Dh13,135 million.

Total assets reached Dh23,805 million, an increase of five per cent over the corresponding 2013 figure. When compared to December 31, 2013, total assets declined slightly by five per cent from Dh24,973 million. This was mainly driven by a six per cent decline in customer deposits to Dh17,217 million, the bank said.

The main reason for the decline in deposits was the unwinding of expensive and unstable deposits, it said. However, when compared to the same period of last year, customer deposits increased by three per cent to Dh17,217 million.

This also accounts for the drop in net liquidity between December 2013 and June 2014. However, the bank’s net liquidity remained substantially high, compared to industry levels, at Dh5.3 billion, representing more than 30 per cent of customer deposits, it said.

Total operating income for the six months declined by 18 per cent compared to the corresponding period of 2013, mainly due to the decline in both net interest income and non-interest income.

Net impairment charges on financial assets for the first half of 2014 declined by 67 per cent.

Ahmed Al Noman, the board’s chairman, said: “We have all along warned against the consequences of margin trading on the UAE nascent financial market in the absence of market makers or institutional investors and sophisticated investors. And with the Emerging Market status and the relaxation of the foreign ownership rules, we have also invited external players whose sole objective or aim is the booking of short term profit.”

— business@khaleejtimes.com