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AbdulAziz Al Ghurair, and Ahmed Abdelaal

Mashreq posts $165m net profit for Q1

DUBAI, 21 days ago

Mashreq, one of the leading financial institutions in the UAE, today reported a robust growth in operating income and net profit for the quarter ending March 31. 
 
The bank's net profit increased to AED606 million ($165 million) in Q1 2022 compared to AED43 million in Q1 2021. This was mainly as a result of a decrease in impairment allowance by 64.5% Y-o-Y, the bank said.
 
Operating income increased by 11% over the previous year to AED1.6 billion due to increased net interest income and income from Islamic financing, coupled with improvements in fees and commission. Operating profit at AED894 million is a 13.3% increase compared to Q1 2021 as a result of higher operating income. 
 
Mashreq’s non-interest income to operating income ratio continues to remain high at 47% (47.6% as of December 2021), the bank said. 
 
The bank enjoys comfortable liquidity and capital position, it said 
 
Other highlights of the results are: 
* Growth of 2.7% YTD in customer deposits to reach AED104.2 billion
* Liquid assets ratio stood at 29% with cash and due from banks at AED48.9 billion as on March 31, 2022 
* Capital adequacy ratio stood at 14% 
* Healthy growth in the loan portfolio 
* Total assets increased by 3.1% YTD to AED182.6 billion and loans and advances increased by 5.9% YTD to AED86.3 billion
* Loan-to-deposit ratio remained stable at 82.8% at the end of March 2022
* Impairment allowance reduced to AED252 million from AED711 million in Q1 2021
* Non-performing loans to gross loans ratio declined to 4.6% as of end of March 2022 (5.2% as of December 2021)
* Total provision for loans and advances reached AED6.4 billion and coverage ratio improved to 131.6% as on March 31, 2022 (128.2% in December 2021)
 
AbdulAziz Al Ghurair, Chairman of Mashreq, said: “Mashreq has delivered a strong start to the new year, with Q1 2022 showing robust year-on-year growth across key metrics, significant risk cost reductions and increased operating income.
 
"The bank’s digital and operational strategies were also fundamental to our improved performance in Q1, with the launch of new services and platforms that reflect Mashreq’s expertise in shaping the future of payments across the region and its commitment to unleashing the enormous benefits of the digital economy. As part of this journey, the Bank has entered new partnerships and investments in Q1 that advance our API and banking-as-a-service capabilities. 
 
"As a result of its strategy, the bank recorded significant improvements in net profits, driven in part by the continuation of growth across the loan portfolio, higher net interest income and increased income from Islamic financing," he said. 
 
Al Ghurair added: "As 2022 unfolds, we anticipate that Mashreq will continue to forge its leading role as a digital challenger, advisor and partner for our corporates and SME development across the global markets. Additionally, armed with a sharp focus on the creation of advanced digital solutions, Mashreq will continue to contribute to the UAE national economy, the nation’s businesses and all those who live and work here.” 
 
Ahmed Abdelaal, Group CEO, Mashreq Bank, said: “As 2022 began, we set out to build upon the successes of 2021 by actioning a series of targeted investments in people, services and technologies. Our strategic approach delivered a year-to-date increase in loans and advances of 5.9%, which reached AED86.3 billion by March 31. 
 
"Delivering innovations in customer channels and back-office operational platforms, the bank leveraged multiple digital solutions in Q1, including machine learning, artificial intelligence, OCR, and Blockchain. Looking ahead to the coming months, these capabilities will ensure that the Bank continues to serve as a one-stop-shop for all retail and corporate trade finance requirements with a full and always-evolving suite of products and services.
 
"The launch of NEOPAY in March represented yet another significant advance for the bank and its role as a digital-first enabler of business success. The new platform, which will help fuel the growth of Mashreq’s payment business, leverages the latest technology and innovation, including card processing and merchant acquiring systems, processing switches and PoS inventory," he said. - TradeArabia News Service



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