RAKBANK announces AED 86.1 million net profit in Q1

The current quarter's increase continues the Bank's recent history of solid growth performance.

Funded income grows by 39%

Net interest income of AED 120 million for the current quarter registered an increase of 39% over 31 March 2006 due to the significant increase in the mortgage finance, commercial Loan and credit card portfolio of the bank.

Gross loans and advances ended the quarter at AED 7.35 Billion an increase of 4% over 31 December 2006 and an increase of 22% compared to the 31 March 2006. The Personal Banking portfolio continued to grow throughout the quarter in line with targeted expansion. The mortgage loan portfolio saw an increase of 11% over December 2006.

Whilst the bank's total equity increased to over AED 1.25 Billion the annualised ROE (Return on Equity) increased to 29%.

Fee, commission and other income grows by 45%

Fee, commission and other income at AED 81 million registered a 45% increase over 31 March 2006. This demonstrates the bank's strategic shift in enhancing its fee income by providing quality service to its customers.

The Bank continues to invest in product development, technology and other delivery channels and remains in the forefront of Emiritisation in the banking industry.

Assets and liabilities

Total assets as at 31 March 2007 were AED 9.23 billion, a 4% increase from 31 December 2006 (AED 8.84 billion) resulting mainly from the growth in net loans and advances by AED 270 million

The growth in the asset book has been supported by a combination of increases in customer deposits and an increase in shareholders' equity. Customer deposits increased by AED 289 million from 31 December 2006 through a healthy combination of increases in transaction accounts and fixed term deposits.

Capital Adequacy

The Bank's liquidity position continues to be strong. The capital adequacy ratio at the end of current quarter stood at 15%, against a minimum of 10% as prescribed by the Central Bank.

Ratings

The Bank is currently rated by the following rating agencies. The current ratings stand as follows: Moody's rated deposits at Baa1 / P-2 and financial strength at D+, while Fitch rates deposits A-/ F2 with stable outlook and ranked 1 for support. Capital Intelligence on the other hand rated deposits at BBB+/ A2, with financial strength at BBB+ and outlook, stable, while support is ranked 3.