Dubai Islamic Bank 1st Quarter 2018 Financial Results

Net Profit reaches AED 1.211 billion, up by 16%
Top line revenue rose by 13% to AED 2.7 billion

Dubai Islamic Bank (DFM: DIB), the first Islamic bank in the world and the largest Islamic bank in the UAE by total assets, today announced its first quarter results for the period ending March 31, 2018.

1st Quarter Results Highlights:

Resilient profitability as core business growth continues

Group Net Profit increased to AED 1,211 million, up 16% compared with AED 1,042 million for the same period in 2017.
Total income increased to AED 2,697 million, up 13% compared with AED 2,378 million for the same period in 2017.
Net Operating Revenue increased to AED 1,971 million, up 9% compared with AED 1,804 million for the same period in 2017.
Impairment losses stood at AED 168 million.
Costs held flat, with cost to income ratio declining to 29.9% compared with 32.8% for the same period in 2017, depicting continued focus on creating efficiencies across the organization.
Net funded income margin stood at 3.03%, still amongst the top end of the market.

Balance sheet key metrics continue to impress

Net financing & sukuk investments rose to AED 162.7 billion up by nearly 3.5%, compared to AED 157.3 billion at the end of 2017.
Total Assets stood at AED 211.1 billion at the end of first quarter 2018.

Asset Quality remained robust

NPF ratio steady at improved to 3.4%.
Provision coverage ratio improved to 122%, compared to 118% at the end of 2017.
Overall coverage including collateral at discounted value now stands at 158.4%, compared to 156.5% at the end of 2017.

Strong liquidity supporting growth

Customer deposits stood at AED 151.7 billion at the end of first quarter 2018.
Significant CASA proportion constituting 34% of total deposit base.
Financing to deposit ratio stood at a healthy level of 90%.

Capitalization at optimum levels to support growth

Capital adequacy ratio remained strong standing at 15.0%, as against 12% minimum required.
Planned capital raising to boost CET1 (currently at 9.5% under BASEL III) to support growth.
DIB has been designated a Domestic Systemically Important Bank (D-SIB) – additional capital buffer of 0.5% required by January 1st, 2019.

Robust shareholder returns while delivering strong dividends

Earnings per share further improved to AED 0.19 in Q1 2018 compared to AED 0.16 in the same period.
Return on assets increased to 2.35% in Q1 2018.
Return on equity rose to 19.2% in Q1 2018.

Management’s comments on the financial performance for the period ending March 31, 2018:

His Excellency Mohammed Ibrahim Al Shaibani, Director-General of His Highness The Ruler’s Court of Dubai and Chairman of Dubai Islamic Bank, said:

The overall macroeconomic environment continues to recover, with bright prospects on the horizon for 2018, based on further improvement in global oil prices and pick up in investment activity, as a result of mega projects leading up to the Expo 2020.
DIB carries on its growth aspirations in the coming years following recent approvals from our shareholders to increase its capital and deploying it towards growing and expanding the business franchise.
The quarter saw improving financial metrics across the industry following the implementation of new economic and banking regulations such as Basel III, IFRS 9 as well as VAT as the market continues to strengthen its domestic policies.

Dubai Islamic Bank Managing Director, Abdulla Al Hamli, said:

Once again, the bank has given a robust performance across all major financial KPIs as the growth agenda continues.
The significant growth in profitability over the years has enabled the bank to continue to distribute strong dividends to shareholders whilst optimizing internal generation of capital.
As Islamic banking activities continuing to pick up pace in the country, DIB remains a key player in the financial sector with a growing market share year on year.