RAKBANK, the national bank of Ras Al Khaimah, announced a net profit of Dh758.3 million for the year 2021, resulting in a three-fold increase of Dh252.9 million than the previous year.
The bank’s total assets amounted to Dh56.3 billion, increasing by 6.7 percent over 2020. In addition, the gross loans and advances closed at Dh34.2 billion, a year-on-year hike of 6.1 percent.
Similarly, customer deposits grew by 1.9 percent and this is due to the growth in time deposits by 7.4 percent compared to the previous year, amounting to Dh660.1 million. Similarly, the return on average assets ratio closed the year at 1.4 percent compared to 0.9 percent for the previous year, and the return on average equity was 9.5 percent, compared to 6.5 percent in 2020.
The board of directors recommended the distribution of a cash dividend of 22.5 fils per share for the shareholders’ consideration and approval at the annual general meeting (AGM).
Peter England, the CEO, RAKBank, said: “We continue to transform our bank with a focus on simplification, digitalization, and building a culture of excellence. Throughout these past years, we have seen that RAKBank’s resilience and nimbleness enabled us to offer sound support to our customers throughout the pandemic, with the help of the country’s regulators. Income growth has been a challenge in 2021 as a result of very little business activity during 2020. However, we saw this gradually turn around as the year progressed and the business momentum in the second half of 2021 reflected positively on the bank’s performance. On asset quality, we have seen a significant improvement and our provisions for 2021 are the lowest they have been in the last 6 years, indicating a strong rebound in the economy and the success of our business diversification strategy that we commenced in 2015.”
The bank’s total income for the financial year ended December 31, 2021, amounted to Dh3.2 billion, which decreased by 9.4 percent as compared to the same period of the previous year. Net interest income and net income from Islamic finance stood at Dh2.2 billion for the year 2021, decreasing by 14.1 percent year on year. Non-interest income increased by Dh23.7 million year on year to Dh1.1billion, mainly due to an increase of Dh54.1million in net fees and commission income. Operating expenses remained the same year on year and the cost to income ratio closed at 43.2 percent for the year.
The chairman, Mohamed Omran Alshamsi, commented that the bank’s financial performance yielded a high return despite the operating challenges of 2021. The complete turnaround of the UAE’s economy in the second half of the year motivated RAKBank to do the same. Therefore, the firm focused on investments in digitalization of customer services that drive efficiency to the top and discover new segments, according to the diversification strategy. This showcased the firm’s strong position for sustainable growth in the future.