National Bank of Fujairah (NBF) announced its first half results for the period ended 30 June 2007 where profits increased to AED 152.6 million, up 45% from profit of AED 105.2 million in corresponding half year of 2006.
“Our second quarter results are extremely encouraging. They reflect the continued progress on our strategy of ‘build and diversify’ which is aimed at producing new benchmarks for the Bank” said Asad Ahmed, NBF’s General Manager. “NBF continues to build on its core strengths and remains focused in penetrating into the SME and retail markets. Our new business areas, such as SME and Wealth Management are now beginning to add meaningful value to overall results which will further elevate shareholders value” he added.
Interim results apart from the continued sustainable growth in core business are also driven by strong performance of the bank’s well structured international investment portfolio. Net interest income rose by 35% and fee income by 28% over corresponding half year on the back of sustainable growth in volumes and improved margins. Income excluding investment rose by 36% for the quarter.
Total assets and liabilities grew by 9.4% and 10.8% respectively to AED 9.4 billion and AED 7.8 billion over 31 December 2006. Earnings per share increased to AED 0.14 for the half year from AED 0.10 in 2006. Return on average equity rose from 14.9% in June 2006 to 20.3% while return on average assets stood at 3.4% for the interim period as opposed to 3.3% in 2006. Total shareholders’ equity as of 30 June 2007 stood at AED 1.6 billion and the Bank’s capital adequacy ratio at period end stood at 16.68 % against the Central Bank minimum of 10%.
Operating expenses increased by 53% for the half year mainly on account of employee related cost, which reflects both our growing number of employees and the bank’s policy of compensating employees well in line with current market benchmarks. Cost to income ratio at 31.3% was marginally up compared to 30.0% of corresponding six months of 2006 reflecting investment in new business initiatives and expansion of distribution network. The Second quarter saw the launch of NBF’s first offsite ATM to be followed by several more in the second half.
During the third quarter, the Bank plans to go live on its new core banking system T 24 as well as centralizing its operations into new 26,000 square feet facility in Jebel Ali.
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