CBD’s H1 profit jumps 27.5% to Dh676m

Total assets of the bank rose 20.4 per cent to Dh112.8 billion as at 30th June 2021, from Dh93.7 billion as at June 30, 2020. — Wam
Total assets of the bank rose 20.4 per cent to Dh112.8 billion as at 30th June 2021, from Dh93.7 billion as at June 30, 2020. — Wam

Dubai - CBD has reached a record Dh113 billion in assets driven by strong growth in loans.



by

Issac John

Published: Wed 28 Jul 2021, 4:04 PM

Last updated: Wed 28 Jul 2021, 4:05 PM

Commercial Bank of Dubai (CBD) reported on Wednesday a 27.5 per cent year-on-year increase in first-half net profit to Dh676 million.

The bank attributed the performance to improved operating performance coupled with lower expected credit losses.

“Despite the continuous decline in interbank interest rates, net interest income is up by 8.7 per cent compared to H1 2020 primarily from lower funding costs and strong business growth. The increase in business activity was reflective of the economic recovery which positively impacted fees and commission income,” CBD said in a statement.

Operating income surged 11.4 per cent to Dh1.572 billion in the first six months of 2021 compared to the prior comparative period, primarily due to improved fee and commission income and higher net interest income Operating expenses also rose by 5.8 per cent to Dh 409 million, while operating went up by 13.4 per cent to Dh 1.163 billion. Net impairment allowances were Dh487 million, down 1. 6per cent, the bank said.

Dr Bernd van Linder, chief executive officer of CBD, said the ongoing Covid-19 pandemic has been managed admirably by the UAE, enabling the community and businesses to move forward positively and with confidence. “Looking ahead, we remain hopeful that the pandemic situation continues to improve globally, enabling improved health and economic conditions for all.”

“Against this backdrop, CBD has reached a record Dh113 billion in assets driven by strong growth in loans, which have increased 17 per cent compared to H1 2020. Overall, our net profit was Dh676 million, above the prior comparative period on the back of improved net interest income, higher commission and fee income, and moderately lower expected credit losses,” said van Linder.

He said the bank remains committed to supporting personal, business and government customers across the UAE, providing seamless market leading banking experiences for all our customers.

Total assets of the bank rose 20.4 per cent to Dh112.8 billion as at 30th June 2021, from Dh93.7 billion as at June 30, 2020.

Net loans and advances were Dh74 billion, registering an increase of 16.8 per cent compared to Dh63.4 billion as at 30th June 2020.

Customers’ deposits were Dh 79.8 billion as at 30th June 2021, representing an increase of 22.2 per cent compared to Dh65.3 billion as at 30th June 2020. Low cost current and savings accounts (CASA) constitute 40 per cent of the total deposit base, while the financing-to-deposits ratio stood at 92.8 per cent, the bank said.

The non-performing loan (NPL) ratio decreased to 6.44 per cent, down from 6.77 per cent at the end of 2020.

The net impairment charge totalled Dh487 million for the first half of 2021. The coverage ratio was 72.67 per cent (118.12 per cent inclusive of collateral for stage-3 loans), up from 69.7 per cent at the end of 2020. As at 30th June 2021, total allowances for impairments amounted to Dh4.241 billion.

CBD’s capital ratios remained strong with the capital adequacy ratio (CAR) at 15.69 per cent, Tier 1 ratio at 14.52 per cent and Common Equity Tier 1 (CET1) ratio 12.04 per cent, CBD statement said. — issacjohn@khaleejtimes.com


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