Posted on May 08, 2017

Mashreq, one of the leading financial institutions in the UAE, today has reported its financial results for the first quarter ending 31st March 2017.

Key highlights [1Q 2017 vs 1Q 2016]:

  • Stable growth in Net Profit
    • Net profit increased by 2.7% year-on-year to AED 546 million primarily due to a 15% decrease in impairment allowance
    • Net Interest Income & Net Income from Islamic Products down by 3.6% year-on-year, on the back of flat loan growth
  • Consistently high proportion of net fee and commission income
    • Mashreq’s best-in-class non-interest income to operating income ratio remained high at 41.6%
    • Investment income, FX & Other income increased by 17.9% YoY
  • Healthy balance sheet composition
    • Total Assets decreased by 1.7% in the year to reach AED 120.7 billion; Customer Deposits declined slightly by 0.8% to reach AED 76.4 billion
    • Loan-to-Deposit ratio remained healthy at 80.5% at the end of March 2017
  • Strong liquidity and capital position
    • Liquid Assets to Total Assets stood at 28.1% with Cash and Due from Banks at AED 33.9 billion
    • Capital adequacy ratio and Tier 1 capital ratio continue to be significantly higher than the regulatory limit and stood at 17.1% and 16.2% respectively
  • Maintained asset quality
    • Non-Performing Loans to Gross Loans ratio remained relatively steady at 3.3% at the end of March 2017.
    • The risk charge for the quarter decreased from AED 425 million in 4Q 2016 to AED 311 million and Total Provisions for Loans and advances reached AED 3.5 billion, constituting 145.5% coverage for Non-Performing Loans

Mashreq delivered stable financial results for the quarter ending March 2017, reporting a net profit of AED 546 million. Earnings per share are strong at AED 3.08 as of March 2017.

Mashreq’s CEO, Abdul Aziz Al Ghurair commented, “Given the challenging business environment in 2016, Mashreq’s cautious stance has allowed us to stay focused on building quality assets whilst upholding a strong liquidity position, as evidenced by the bank’s healthy loan-to-deposit ratio of 80%.” He added, “The stabilization in the business environment coupled with our sharp focus on asset quality has led to lower provisions for impairment, down 27% from the previous quarter. We are well poised to take advantage of market opportunities, and will see better upside in profits if the operating environment remains stable.” Al Ghurair concluded, “As we celebrate our 50th year, we are thankful for the decades of support we have enjoyed from our clients and partners. We remain committed to these long term relationships as we look forward to 50 more years.”

In the first quarter of 2017, Mashreq Qatar has led innovation to new heights by further enhancing its award –winning mobile application Snapp. Mashreq’s customers can now register directly through the application using their debit or credit card. Snapp users also have full control of their debit and credit card spends alongside several security features and now they have access to Apple’s virtual personal assistant Siri. During the first quarter, MashreqGold, the premium banking segment launched the New MashreqGold Transactional Banking proposition offering unique pre-loaded benefits along with free flights and premium hotel stays in Dubai.

Mashreq Qatar continues to provide Business Banking customers with tailor made lending solutions, alongside other benefits  ensuring  the most rewarding relationship to continue supporting the development of SMEs in Qatar; Mashreq customers got guaranteed Cashback by simply using MashreqOnline & Snapp for fund transfers, earned Salam point on every Riyal saved and to make it more convenient to our customers, average account balance was reduced and in addition to that most Premium & Platinum fees were waive to make eligibility probable  for the client.