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UAB announces net profit of AED 328m for H1, 2014

July 20, 2014

SHARJAH, 20th July, 2014 (WAM) -- The United Arab Bank P.J.S.C ("UAB" or "the Bank") has announced its financial results for the six months ended 30 June 2014, showing a net profit of AED 328 million and registering an increase of 26 percent over H1, 2013.

Sheikh Faisal bin Sultan bin Salem Al Qassimi, Chairman of the Board of Directors on the occasion said, "I am pleased with the strong performance generated by United Arab Bank this first half of 2014. The Bank continues to deliver exceptional performance and sustained growth, offering true value to our customers, shareholders and partners. It has maintained an impressive pace of growth in a highly competitive market, once again positioning itself as the fastest growing bank in the Middle East. We are well placed to take advantage of future growth opportunities across the Emirates and continue to benefit tremendously from the solid platform created by the banking alliance that we share with The Commercial Bank of Qatar (CBQ), National Bank of Oman (NBO) and Alternatifbank in Turkey."

Paul Trowbridge, Chief Executive Officer commented on the Bank's half year results, "It is my pleasure to report a strong set of half-yearly financial results. Our exceptional growth over the same period in 2013 is testament to the effectiveness of our customer-centric strategy. The improving business mix and efficiency of our funding have led to a significant increase in Loans and Advances and Customer Deposits. These increased volumes are a direct result of our proactive enhancements and continued efforts to identify and develop new income drivers. With this outstanding performance, we are set to take advantage of the positive economic outlook for the UAE and the region".

"Our emphasis on providing premium services, offering innovative solutions and 'best in class' products gives both our new and existing customers the best possible banking experience. We will continue to showcase our award-winning services to a wide range of customers and strengthen our foothold in the UAE, with branches in key locations to be accessible to all."

The Bank generated Operating Profit of AED 475m, a 43 percent uplift over prior year. Total Income increased at an equally significant rate of 41 per cent to AED 676 m, with solid performance across both Net Interest Income and Non-Interest Income, up 40per cent and 46per cent respectively versus H1 2013.

Non-Interest Income, a general benchmark indicating the depth of customer relationships, expanded strongly in the first half to AED183m, driven primarily by Other Operating Income (AED80m) and Net Fees and Commissions (AED61m). With Non-Interest Income representing 27 per cent of Total Income in H1 2014, our strategic emphasis on building and developing customer relationships continues to reap rewards.

Operating Expenses for the first six months were AED 201m versus AED 146m for the same period in 2013, and remain in line with management expectations. Our ongoing network expansion programme continued across Q2, with the Bank now benefiting from 27 fully operational branches across the Emirates, with other locations planned in the second half of 2014.

Nevertheless, despite UAB's sustained investment to improve the overall customer experience and developing infrastructure to support future growth, the Bank's Cost : Income Ratio improved to 29.7 per cent.

Provision charges in H1 2014 were AED147 m, compared to AED 72 m for the same period in 2013. The accelerated booking of General Provisions will ensure full and early satisfaction of central bank requirements.

In parallel, the Bank continues to take a cautious and proactive approach to risk management, with our track record of growing our asset portfolio whilst maintaining quality evidenced by our sector leading Non-performing Loan Ratio (1.50 percent) and Coverage Ratio (134 percent) as at 30 June 2014.

Total Loans and Advances improved by 35per cent to AED17.9 bn versus H1 2013, with growth across all business units. Similarly, Customer Deposits increased by an outstanding 49per cent in the same period to stand at AED18.6 bn, further reinforcing the depth of our customer relationships and ongoing sustainability of UAB's growth strategy

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Source: Emirates News Agency (WAM) (United Arab Emirates)

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