Union National Bank announces net profit for the first nine months of 2007

The results are quite encouraging, given that income from opportunistic capital market related activities was included in 2006, which has not been the case so far in 2007. On a core business comparative basis, the Bank's net profits have risen by 45% over this period. The net profit for the three months period ended 30 September 2007 was Dhs295.2m, compared to Dhs206.3m for the same period in 2006, representing an increase of 43.1% quarter-on-quarter reflecting solid growth in business and income from the core banking activities.

The net loans and advances have grown by 36.4% to reach Dhs35.0bn as at 30 September 2007 (30 September 2006: Dhs25.7bn) on the back of sustained deal generation. The Bank was actively involved in the area of loan syndications. Customers' deposits grew to Dhs31.4bn (30 September 2006: Dhs25.8bn), an increase of 22.1% and along with an increase in medium term borrowings supported the asset growth. These increases contributed to the consolidated total assets as at 30 September 2007 reaching Dhs46.4bn as compared to Dhs36.1 bn for the same period last year, an increase of 28.7%.

The return on average assets of 2.6% and return on average equity of 18.2 % for the period ended 30 September 2007 remained satisfactory. The operating expenses increased by 27.7% for the nine month period ended 30 September 2007 as compared to the corresponding period last year mainly due to the consolidation effect of the Group's new subsidiaries (Al Wifaq Finance Company and Alexandria Commercial & Maritime Bank) and the ongoing investment in the infrastructure and branch expansion to offer a superior customer experience. The efficiency ratio (cost to income) was well contained at 29.6%.

Commenting on the satisfactory results, Mr. Mohammad Nasr Abdeen, Chief Executive of the Bank stated, "The solid results over the three quarters are a re-affirmation of our strategy to pursue focussed growth in our home market (UAE) whilst following a controlled regional expansion programme that should be value accretive for our stakeholders".