CBI reports Dh21 million first quarter net profit

25/04/2017 05:53 AST

Commercial Bank International (CBI) reported a net profit of Dh21 million for the first quarter of 2017 compared to Dh37 million in the first quarter of 2016.

The bank said in a statement that its first quarter profits were impacted by higher gross provisions due to challenging market conditions and the timing of recoveries. Operating income increased by 9 per cent to Dh203 million compared to Dh187 million in the same quarter last year. Net interest income increased by 10 per cent to Dh126 million compared to Dh114 million in the first quarter of last year. Operating profit increased by 13 per cent to Dh92 million against Dh81 million in the first quarter of 2016.

“The substantial increase in our operating profit is a testament to the strength of CBI’s core business, and to the bank’s commitment to continue to provide products and services to meet our customers’ evolving demands,” said Mohammad Sultan Al Qadi, Chairman of CBI. Net interest income increased by 10 per cent to Dh126 million compared to Dh114 million in the first quarter last year despite a general increase in cost of funding across the sector. Net fee and commission income in the quarter was down by 12 per cent to Dh57 million. Operating expenses for first quarter 2017 increased by 5 per cent to Dh111 million compared to the same quarter in 2016.

Net Loans and advances for the first quarter of 2017 increased by 3 per cent from year-end 2016 and by 12 per cent over the last 12 months to total Dh13.68 billion largely driven by business loans, personal loans and mortgage loans. Customer deposits increased 4 per cent from the year-end 2016 and by 23 per cent over the last 12 months to total Dh14.5 billion. Loan to deposits ratio for the first quarter 2017 was 94.4 per cent against 103.6 per in the same quarter last year.

“The bank’s underlying business continues to perform well and through improved service delivery, we have increased our share of the market during the first quarter of the year. Growth was partly driven by the strong performance of our retail business where new-to-bank customer acquisition nearly doubled in the first quarter of 2017 as compared to Q1 2016,” said Mark T. Robinson, CEO of CBI.

Non-core assets stood at Dh746 million at the close of the first quarter decreasing by 24 per cent from the same period in 2016 as the bank continued divesting non-core businesses. The capital adequacy ratio at the close of first quarter 2017 remained stable at 14.6 per cent.

Gulfnews