Mashreq, the Dubai-based lender, on Wednesday said its net profit fell 20.7 per cent in the fourth quarter amid higher provisions, a drop in income from fees and commissions as well as a loss on investments.
Profit slipped to Dh441 million in the three months ended December 31 compared with Dh556m in the corresponding period of 2015, the bank said.
The bank’s impairment allowance rose 34 per cent in the quarter on a year-on-year basis to Dh425m from Dh318m.
Meanwhile, fee and commissions income dropped 8.2 per cent to Dh392m from Dh427m, the lender said. Investment income registered a loss of Dh1m in the quarter versus a loss of Dh7m in the corresponding period in 2015.
“While the region weathered tough business conditions in 2016, Mashreq had a reasonable year despite the economic climate and low oil prices,” said Abdul Aziz Al Ghurair, the bank’s chief executive.
“Mashreq is in a very strong position as it enters 2017 with a diversified balance sheet and customer base.
With the Government’s continued focus on economic diversification, investment in hydrocarbon assets, and its smart city initiatives, Mashreq’s strategy on innovation and focus on customer experience will serve us well as enter our 50th year.”
Mr. Al Ghurair, who is also the head of the UAE Banks Federation, said in November that banking sector profits may fall between 10 and 20 per cent in 2016 versus 2015 as a slowing economy takes its toll on loan growth.
mkassem@thenational.ae
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