Sharjah Islamic Bank (SIB) has posted an increase in its operating profit before provisions by 25.6 percent, amounting to AED417.3 million ($103.6 million) for the first six months (H1), compared to AED332.3 million for H1 the previous year.
Net profit amounts to AED289.5 million for the six months period ended June 30 2021 compared to AED251.2 million for the same period of the previous year, an increase of 15.2 percent, despite an increase in net impairment provisions, which amounts to AED127.8 million, compared to AED81.1 million for the previous year, an increase of AED46.7 million, equivalent to 57.6 percent, reported Emirates news agency Wam.
Strong results are a reflection of Bank’s robust business policies on the face of challenging global operational conditions owing to the on-going Corona pandemic.
Net income on financing and investment products increased by 16.3%, equivalent to an increase of AED75.5 million, to reach AED538 million for the first six months of 2021, compared to AED462.6 million for the same period last year, whereas, net fees, commissions and other income increased by 14.8 percent to reach AED152 million, compared to AED138.7 million for the same period in the previous year.
The Bank maintained the same level of expenses compared to previous period, where the general and administrative expenses amounts to AED272.8 million at the end of the first half of 2021, compared to AED269.0 million for the same period in 2020; a marginal increase of AED3.7 million, or 1.4 percent.
The balance sheet of the bank showed an increase in total assets by 1.5 percent to reach AED54.4 billion as on June 30, 2021, compared to AED53.6 billion for the previous year.
The bank has continued to maintain a strong liquidity, which amounted to AED13.0 billion, at a rate of 23.8 percent to the total assets, compared to AED11.2 billion, or 20.9 percent of the total assets at the end of the previous year.
The bank continued to diversify its financing portfolio in various economic sectors and follows a wise credit policy that takes into account all developments associated with the Corona pandemic and its impact on financial markets, as the total customer financings stabilized at an amount of AED29.3 billion, at the same level of previous year end.
The bank was able to attract a larger volume of customer deposits during the period, as deposits increased by 4.1 percent, bringing the total deposits to AED35.0 billion, compared to AED33.6 billion at the end of 2020.
Sharjah Islamic Bank has a strong capital base, as the total shareholders’ equity at the end of June 2021 amounted to AED7.6 billion, which represents 14.0 percent of the Bank’s total assets. Thus, the Bank maintained a high capital adequacy ratio in accordance with Basel III at 20.77 percent. Hence, the rate of return on average assets and average equity increased significantly, at 1.07 percent and 7.6 percent annualised, respectively, compared to 0.81 percent and 5.35 percent at the end of the previous year.