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Commercial Bank of Dubai's 2013 profit crosses Dh1 billion mark

January 29, 2014

Commercial Bank of Dubai (CBD) on Wednesday reported an 18 per cent growth in net profit to cross Dh1 billion mark in 2013. "With this the CBD maintains its record of annual growth in its net profit over the last five years right through the economic downturn," the bank said in a statement. The bank has proposed a cash dividend of 30 per cent and bonus shares of 10 per cent for 2013. CBD said the record net profit of Dh1.01 billion, as compared to Dh857 million in 2012, was achieved on the back of a 9.4 per cent growth in operating income, which reached an all-time high of Dh2.03 billion. Net interest income increased by 8.7 per cent to Dh1.45 billion in 2013 from Dh1.33 billion in 2012, while non-interest income increased by 11.1 per cent from Dh525.7 million in 2012 to Dh584.2 million for 2013, the bank said. The bank's operating expenses increased by 9.7 per cent from Dh572.2 million to Dh627.6 million for the full year ended 2013 as the lender made substantial investments in its resources and infrastructure. "As a result operating profit increased by a solid 9.3 per cent from Dh1.286 billion to Dh1.405 billion," it said. Efficiency ratio increased slightly from 30.8 per cent to 30.9, lower than local industry average. Total assets Dh44.5 billion, a 13.2 per cent increase over the Dh39.3 billion. Loans and advances increased by 11.3 per cent from Dh27.2 billion to Dh30.3 billion. The bank continued to grow its corporate banking business where gross lending increased by 9.7 per cent from Dh26.9 billion to Dh29.5 billion. Bank said its increased focus on personal banking offering resulted in a 35 per cent increase in gross personal loans from Dh2.4 billion to Dh3.3 billion. Peter Baltussen , chief executive officer of CBD, said the bank's record net profit was a result of a strong performance across all business lines. "Our personal banking strategy with renewed focus on the affluent segment has enabled us to diversify our bottom line and increase our market share. At the same time we continue to stay close to our corporate and commercial clients particularly the family owned businesses to ensure that we are their preferred banking partner in the coming years. I believe CBD with its comfortable liquidity and robust capital adequacy is in a strong position to grow along with its clients." Baltussen said 2014 would see the bank further consolidate its personal banking strategy with the launch of an innovative, virtual and personalised banking offering which will provide customers with a "unique" experience. The full-year impairment charge for loan portfolio was Dh419 million, including Dh33 million for general provisions, which represents 1.5 per cent of the bank's credit risk weighted assets. The non-performing loan (NPL) ratio improved from 11.2 per cent to 10.1 per cent and the NPL coverage ratio improved to 84.9 per cent from 71.7 per cent in 2012, the bank said.

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Source: Khaleej Times (United Arab Emirates)

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