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Ajman Bank's profits are showing the first solid growth for some time. Jeff Topping / The National
Ajman Bank's profits are showing the first solid growth for some time. Jeff Topping / The National

Ajman Bank finds all good things come to an end

What's Down: Ajman Bank's shares slipped yesterday following recent rises, but its stock is still up for the year.

Emirati banks have ridden such a wave of investor confidence this year that even relative minnows have been caught up in the excitement.

But following recent rises, stocks in Ajman Bank, an Islamic lender listed on the Dubai Financial Market, fell 1.19 per cent to 83 fils a share yesterday. The decline came against a day that saw the wider Dubai index rise 1.22 per cent.

The bank's stocks have, however, risen 4.2 per cent since the start of the year.

Ajman Bank reported a second-quarter profit of Dh556,000 this month, compared with a loss of Dh2 million in the same period last year.

Earnings per share following the bank's last earnings release were 0.06 fils.

Nevertheless, the bank's profits are also showing the first solid growth for some time. Ajman Bank recorded a loss in the first quarter, and before that was on track to report a loss for last year until the donation of a plot of land, valued at Dh49.9m, from a director who is a member of the Ruling Family of Ajman.

The most recent financial statements are more encouraging, showing that income from Islamic financing instruments doubled to Dh51.1m. The bank has also signalled a desire to focus on women's banking and expand its network with up to four new branches.

This expansionary drive has also pushed expenses 55.9 per cent higher to Dh48m, mostly driven by higher staff costs alongside increased expenses from marketing and product development.

Ajman Bank is one of a number of small lenders attempting to expand as the UAE's big banks tackle mounting numbers of bad debts.

But rival lenders are proving quicker off the mark, such as Al Hilal Bank, which announced on Sunday its intention to launch a sukuk programme worth at least US$1 billion to finance its expan sion proramme.

Emirates NBD and First Gulf Bank have also reported improved profits.

ghunter@thenational.ae

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