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The Return on Equity in 2006 was 16.2% and EPS (earnings per share) improved by 11% to 23.5 cents per share. The cost/income ratio (the measure of bank operational efficiency) remained broadly unchanged, at 54.1%, despite the sharp increase in headcount (up 45%). UIB continues to follow a stable growth strategy in building its businesses and the resulting 12 months cost growth of 27% was offset by the corresponding 27% increase in operating income.
Total assets almost doubled during 2006, rising from US$149.4 million at 31 December 2005 to US$293.3 million at 31 December 2006. Shareholders' equity has more than doubled over the same period (to US$254.1 million) following the Bank's successful round of capital raising in July 2006. The enhanced capital base will fund further organic and inorganic business growth and so support the Bank's strategy to offer clients a fully integrated range of competitive Shari'ah-compliant products and services on a global basis.
UIB has significantly strengthened its network and franchise in recent months with the opening of an office at the Dubai International Financial Centre and the acquisition of a 75% stake in Inter Yatirim Menkul Dergerler A.S., a brokerage and asset management company based in Turkey with offices in Istanbul and Ankara. The Bank has also acquired a 22.2% interest in First Dawood Islamic Bank in Pakistan.
Mr. Majid Al-Sayed Bader Al-Refai, UIB's Managing Director & Chief Executive Officer said:
'We have achieved with the grace of Allah a major uplift in both our earnings and profitability and significantly strengthened our income streams, liquidity and capital base. The combination of increased earnings and enhanced capital provides a solid platform for expansion via strategic acquisitions and continued organic growth.'
UIB has consolidated a strong market position since its inception in 2004 by creating a foothold in selected markets, particularly in the GCC countries, Southeast Asia and the United States. The increased capital base enhances the Bank's earnings potential going forward.
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Posted by Anne-Birte Stensgaard, Senior News Editor
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