United Gulf Bank (UGB) has announced that its net profit for the last year increased 7.3 times to $11 million, compared with $1.5 million in 2011.

The asset management and investment banking platform of the Kipco Group said that basic earnings per share for the period also increased similarly to 1.34 cents from 0.18 cents in 2011.

The increase in profit is due to improved results of major associates, increased fees and commission income and reduced interest and operating expenses.

Total assets stood at $1.23 billion at the end of last year, down from $1.78 billion in 2011.

UGB said it managed to reduce leverage by $0.4 billion and repay loans from internal resources.

The bank's balance sheet remains strong with total equity of $478.2 million at the end of last year, as compared to $603.2 million for 2011.

UGB's capital adequacy ratio for the year was 23 per cent, well above the minimum regulatory requirement of 12.5 per cent, and the 2011 level of 18 per cent.

The UGB's board will not be recommending any further dividend for last year besides the $96.5 million, in kind distribution approved by shareholders on December 19, last year.

There was no dividend distribution in 2011.

"We have delivered on our commitment made last year of deleveraging our balance sheet, managing our cost base and improving our recurring revenue stream," chairman Masaud Hayat said.

"The results show the strength of our asset base which continues to deliver the expected returns.”

"UGB is well positioned to take advantage of certain opportunities that are consistent with the strategy of investing in core activities and markets," he said. – TradeArabia News Service