Dubai Islamic Bank (DIB), the emirate’s largest Sharia'a-compliant lender, said third quarter net income rose about 26 per cent thanks to strong growth in financing assets and customer deposits, even as impairments more than doubled.
Net profit attributable to owners of the bank increased to Dh1.1 billion for the three months to the end of September, compared to Dh876 million in the same period last year, the bank said in a regulatory filing to the Dubai Financial Market. Income from Islamic financing and investing transactions increased 21 per cent in the quarter to Dh2bn.
"This market beating performance clearly demonstrates the strength of the franchise and the potential the organization has to continue to defy the trend despite the challenges thrown by the global economic environment," chief executive Adnan Chilwan said in an e-mailed statement.
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"With ample liquidity and robust capitalization serving as the backbone to DIB’s growth objectives, the bank is in a strong position to accelerate its plans to expand its franchise locally and internationally and ensure that we continue to deliver even more comprehensive, creative and complete solutions to all our customers in the markets we operate," added Mr Chilwan.
DIB's nine-month net profit rose 10 per cent to Dh3.3bn from the year earlier period. Financing assets increased 14 per cent in first nine months of the year to Dh 131.3bn while deposits increased 17 per cent in the period to Dh143.5bn.
The bank's third quarter results beat estimates from Egyptian investment bank EFG-Hermes, Abu Dhabi Commercial Bank and NBAD Securities. The bank's share price rose by as much as 0.7 per cent in morning trading to Dh6.21.
In August Moody’s Investors Service upgraded DIB's local and foreign currency long-term issuer ratings to A3 from Baa1 due to an improvement in asset quality, less money set aside to cover bad debt and improved profitability. The ratings agency also upgraded its baseline credit assessment on DIB, adjusting it to Ba2 from Ba3. Long and short-term counterparty risk assessment were upgraded to A2 from A3 and P-1 from P-2, respectively, Moody’s said.
