Commercial Bank of Dubai net profits increase by 14 pct

Commercial Bank of Dubai (CBD) said that its operating profit in the first six months of 2009 rose 3.2 per cent to Dh599 million compared to Dh580m in the same period of 2008. Net profit for the first half of 2009 amounted to Dh502 mas compared to Dh566m a year earlier.

Net profit for the second quarter was Dh268m, which represents a 14.4 per cent increase compared to Dh233 Million for the first quarter of this year. The Bank's net interest income of Dh648 Million is 27 per cent over the same period last year as a result of higher volumes combined with an increased interest margin.

Operating expenses increased by 2.8 per cent as compared to the first half of 2008, while the efficiency ratio remained at 30.6 per cent. The Bank took additional provisions totaling Dh75m in the first half of 2009. Consequently the coverage ratio reached 93 per cent, while the non performing loans to total loans ratio stood at 1.1 per cent. It should be noted that the Bank has no exposure to the Saudi Arabian Al-Gosaibi and Saad groups. Total assets of Dh36.5 billion at the end of June reflects a 6.4 per cent growth over Dh34.3bn as at 30th June 2008. Loans and advances grew by 13.8 per cent compared to last June to Dh29bn and customers' deposits were up by 9.2 per cent compared to last June to Dh27.2b.

The Bank's capital adequacy ratio remains a Tier I adequacy ratio of 13 per cent, comfortably exceeding the UAE Central Bank's regulations.

Also, the Bank is in the process of finalizing the formalities for the conversion of the Ministry of Finance Deposits into Tier II Capital, which will improve the capital adequacy ratio. The Bank is listed in DFM and fully owned by UAE Nationals, including 20 per cent by the Government of Dubai.