Finance House, an Abu Dhabi-headquartered finance company, has posted a net profit of Dh66.2 million ($18 million) for the first half of the year, as against Dh61.2 million achieved in H2 2014, marking a rise of 8.3 per cent.

Earnings per Share (EPS) jumped 21 per cent to 23 fils per share from 19 fils per share in the same period last year.

On the back of a sustained growth in the lending book and targeted expansion of the fixed income portfolio, net interest income and income from Islamic financing and investing assets grew by 46.7 per cent year-on-year (YOY) to reach Dh93.4 million during the first six months of 2015 compared to Dh63.7 million in the corresponding period of the previous year.

Net fee & commission income was however lower than the previous year due to lower brokerage revenue from subdued activity in the domestic equity markets during the first 6 months of 2015 compared to the same period in 2014.

Income from a well-diversified proprietary investment portfolio stood at Dh70.3 million, which is 5.4 per cent higher than the investment income of Dh66.7 million registered during the same period of the previous year.

As a combined result of the above, total operating income for the first half of the year increased by 14.4 per cent to Dh183.4 million compared to Dh160.3 million in the same period of the previous year. Due to continued expansion in business activities of the Group, total operating expenses were higher at Dh92.7 million compared to Dh80.8 million in the same period last year.

In line with its conservative approach towards impairment provisioning, FH has set aside additional impairment provision of Dh24.5 million in the first half of 2015 compared to Dh18.3 million in the same period last year.

Total assets grew by 5.1 per cent YOY to reach Dh4.73 billion as of 30 June 2015 compared to Dh4.50 billion at the same time last year. However, net loans & advances including Islamic financing and investing assets grew by a robust 19.8 per cent YOY to reach Dh2.07 billion as of 30 June 2015, compared to Dh1.73 billion at the same time last year. The resultant loans to deposits ratio as of June 30 stood at 81.2 per cent, leaving ample room for growth in lending book in the near term.

Shareholders’ equity stood at a healthy Dh749.5 million compared to Dh703.9 million at the same time last year, whilst the capital adequacy ratio on a risk weighted basis at the consolidated level stood at a robust 19.9 per cent. In line with its cautious approach to liquidity management, cash and cash equivalents as of 30 June 2015 stood at a very comfortable level of nearly 16 per cent of total assets.

Mohammed Abdulla Alqubaisi, chairman of Finance House said: “The relatively stable economic environment in the UAE has allowed us to focus on our core engines of growth which are commercial and consumer lending and proprietary investments.”

“Our strategy of continuously seeking and addressing profitable & underserved niche segments has enabled us to generate healthy returns for our shareholders on a sustained basis. We are confident that this strategy will continue to serve us well in the near future also,” he added. – TradeArabia News Service