Abdul Aziz Al Ghurair

'It's good for the banks; it's good for traders, contractors and sub-contractors, for the people who sell furniture and insurance. It is good news all round for business.

'Next year will be an extension of 2003,' he added. 'Although it might be that profit growth will be a bit lower than in 2003'.

Last year was certainly a record year for Mashreqbank, the largest private bank in the UAE. Profits rose by 19 per cent to $163.8m, and both deposits and lending were up by a healthy $550m each.

At present Mashreqbank income is 50% from non-interest sources, such as fees and bank charges, a trend the CEO is happy to see because this income carries no risk for the bank.

Capital adequacy stands at 15.2% against a Central Bank minimum of 10%. Moreover, the bank has an enviable efficiency ratio of 36% - the ratio of costs to revenues - whereas European banks manage just 70% and even the US banks struggle to get beyond 55%.

Mashreqbank is always full of nice surprises. For example, at the results' press conference Mr. Al Ghurair revealed that expatriates could now own shares in the bank.

'In fact we have had expatriate investors since the bank's inception, but it has been a well kept secret,' he explained. But it is not a secret anymore.

Shareholders remain delighted with Mashreqbank and it may be that a few expatriates now decide to visit the Dubai Financial Market to buy its shares. Earnings per share this year are AED8.39 up from AED7.05 a year ago. And shareholders will get a 25% cash dividend and 10% in stock for 2003.

At the same time the bank has managed to add $272m to shareholders' funds which now total $1.1bn. Return on shareholders funds is up from 14.1% to 15.8% to 16.3% in the last three years.

Non performing loans are down from $381m in 2002 to $155m in 2003. 'We have a very conservative policy on booking provisions,' says Mr. Al Ghurair.

In the past year Mashreqbank has entered the Dubai mortgage market which offers great promise for future growth.

'These are early days,' comments Mr. Al Ghurair. 'We guarantee to turnaround a mortgage offer in three to five days, and people seem to like our speedy 'yes' or 'no'. We have seen a good response in the marketplace.'

There is no doubt that Mashreqbank will remain a firm favorite with local, and perhaps now expatriate investors, with a financial performance that surpasses the ongoing high growth rate of the UAE. All the numbers are very impressive.