Dubai Islamic Bank, the UAE’s largest Islamic bank, announced a record-breaking annual net profit of AED 5.6B for 2022 on Wednesday, up 26% year on year. “The strong growth was driven by rising core revenues, prudent cost management, and sustained lower impairments,” the bank said in a statement.
DIB reported a 20% increase to AED 14B in overall revenue year over year. A 30% dividend is proposed, subject to shareholder approval. The bank reached about AED 63B in annual gross new underwriting and Sukuk compared to AED 50B in FY2021, increasing net financing and Sukuk investments by 5% YoY to AED 238B. Net operating revenues increased significantly year over year by 11% and quarter over quarter by 8% to reach AED 10.467B, while net operating profit increased significantly year over year by 11% and quarter over quarter to reach AED 7.734B.
H.E. Mohammed Ibrahim Al Shaibani, Director-General of His Highness The Ruler’s Court of Dubai and Chairman of Dubai Islamic Bank, said the UAE continued to attain economic growth and expansion amidst a turbulent year withstanding the impact of geopolitical conflicts and higher global inflation depicting its robust financial and monetary policies, strong domestic recovery and fiscal surpluses.
“These robust economic policies have strengthened the banking sector and supported the growth of the domestic financial markets which have exhibited higher trading activities and increased foreign inflows.” The outstanding yearly profitability for FY2022, according to group CEO Dr. Adnan Chilwan, was the bank’s highest-ever net income. “This beat depicts our robust strategy and the management’s efforts and commitment to enhancing shareholders’ value.”
“Core banking profitability metrics and ratios were also solid with net operating revenue up 11% YoY due to a robust balance sheet structure,” said Chilwan, according to Zawya. At AED 199B in 2022, DIB’s client deposits were down 3.5% YoY, while CASA was “comfortably situated at 44% of deposits” with AED 87B. Due to a 12% growth in CASA deposits, DIB was able to raise its deposits during FY2022 by 7% on a QoQ basis.
The bank stated that the liquidity coverage ratio, now at 150% after increasing from 136% in FY 2021, shows a healthy liquidity position and is still above regulatory criteria. Impairment costs for the bank decreased further, at AED 2.103B as opposed to AED 2.448B the year before. The portfolio of consumer banks increased by 5% to AED 53B from AED 51B in FY 2021. The portfolio’s total new underwriting for FY 2022 will be AED 18 billion, a 29% YoY increase, driven mostly by personal and home financing accounts.
“The portfolio expanded by net AED 2.7B, underpinning the bank’s solid retail franchise. The segment is also actively deploying financing in the SME sector,” the bank said. The government and service sectors account for 33% of the corporate banking portfolio, which is now valued at AED 142B. According to the bank, new wholesale credit for FY 2022 was AED 31B, up significantly 40% YoY from AED 22 billion the previous year and driven mostly by government-related organisations (GREs).
