105% increase in the net profit of the National Bank of Ras Al-Khaimah during the first quarter

Abu Dhabi, April 26 / The National Bank of Ras Al-Khaimah recorded a net profit of 450.3 million dirhams during the first quarter of this year, an increase of 105% compared to the first quarter of last year, driven by strong and diversified growth on both sides of the balance sheet, which was supported by strong sales momentum and a lower cost of funds.
Net interest income and net income from Islamic financing after distributions to depositors increased by 46.0% to reach 788.8 million dirhams. Interest income from conventional loans and investments increased by 79.7%, while interest costs on conventional deposits and loans increased by 300.5%. Net income from Sharia-compliant Islamic financing increased by 7.8%.
Non-interest income increased by 52.5% to reach 284.8 million dirhams, mainly due to foreign exchange and financial derivatives revenues during the first quarter of 2023, and total revenues increased by 47.6% compared to 7.9% for the fourth quarter of 2022, benefiting from the momentum balance sheet growth.
Total revenue reached AED 788.8 million in the first quarter of this year, supported by strong net interest income, an increase of 46% year-on-year. The net interest margin increased to 4.9% from 3.8% in Q1 2022 and remains among the highest in the sector.
Total loans and advances amounted to 38.7 billion dirhams, reflecting an increase of 1.4% compared to December 31, 2022 on the back of the change in the balance sheet mix in line with the strategic direction of the bank, and customer deposits amounted to 46.4 billion dirhams, an increase of 3.3% compared to December 31, 2022. Also The bank has a strong franchise in checking and savings accounts, which registered a ratio of 70.5%.
The cost of risk remained low due to the bank’s diversified business mix and the UAE’s resilient economic environment, which led to a 30.9% decrease in impairment provisions compared to Q4 2022. Impairment coverage ratio increased to 192.1% compared to 137.8% in the first quarter of 2022. in 2022, to remain one of the strongest rates in the sector.
“Through the implementation of our multi-year strategy, we have accelerated our growth and achieved record net profit with unprecedented total revenue during the first quarter of the year,” said Rahel Ahmed, CEO of RAKBANK.
He added that the bank achieved strong growth on both sides of the balance sheet, through interest and fee income, in all sectors, indicating that with regard to building deeper relationships with customers, we achieved strong growth in digitally active customers through digital transactions, which increased by 12% over annual basis.
He said, “As one of the largest financing institutions for small and medium enterprises in the country, we continue to support entrepreneurs and startups by opening more than 4,000 business accounts in the first quarter of 2023, of which 1,600 are for startups. Similarly, we provided business loans worth $571 million. Dirhams, of which 394 million dirhams are for new business loan customers.