Dubai Islamic Bank to increase paid-up capital by AED 1 billion

The bank reported net profit for the year ending 31st December 2005 of AED1.061 billion rising by 130 per cent compared to AED461 million in 2004. The results were announced following a meeting of the Board of Directors held yesterday. They are yet to be approved by the UAE Central Bank, and will be submitted to shareholders at the bank's Annual General Meeting. As a result of this strong performance, the Board has proposed a bonus share dividend of 20 per cent and a cash dividend of 20 per cent.

The Board of Directors approved an increase in the bank's paid-up capital by AED1 billion to reach AED2.5 billion, with a suggested premium of AED2 per share, subject to the approval of the official authorities.

The profit for the bank, including depositors' profits, reported a 97 per cent increase for the year ending December 2005 at AED2 billion compared to AED1.017 million for 2004.

Financing and investment operations also delivered strong growth, with total financing now standing at AED25.6 billion rising by 46 per cent compared to 2004. Total assets reported a 40 per cent increase to AED43 billion. Customer deposits too showed an aggressive growth, reaching AED33.34 billion in the year, a growth of 34 per cent over 2005.

"2005 was a landmark year in Dubai Islamic Bank's history," said HE Dr. Mohammed Khalfan Bin Kharbash, Minister of State for Finance and Industry and Chairman of DIB.

"The bank is expanding in UAE and internationally, and has further strengthened its position as a leader in Islamic financing activities. It has significantly broadened its offering to retail customers and diversified its investment and funding operations. DIB is a success story well recognised across the region, and the financial results of 2005 are evidence of that success,"

he added.

Dr Kharbash continued: "While the favourable macro-economic environment in the UAE and the region undoubtedly contributed to the success of the bank in 2005, these figures also reflect a consistent trend of strong growth that goes back to 2003. This trend is characterised by the underlying business fundamentals, as opposed to one-off benefits, and we have an ambitious plan that will enable us to continue this growth through 2006 and the following years. Our strategy of diversifying revenues and operations has paid dividends, and we will continue to execute this strategy going forward."

"DIB's achievements in 2005 included cementing our position as the world's premier Islamic finance house with a string of transactions, culminating in the issuance of the world's biggest ever sukuk for PCFC last month. This followed the ground-breaking gold-backed sukuk we produced for DMCC, and other international transactions. Our track record of strategic partnerships with leading local, regional and international institutions was a particular strength in 2005, and we will continue to pursue this proven strategic approach," he said.

"At a retail level, our innovative new products such as the 'Al Islami personal finance', strengthening the distribution channels, such as the customer call centre, advanced electronic services, and six new branch openings, has driven a greater number of customers to the bank, and enabled us to provide a professional level of service to our valued customer base.

"Internationally, we successfully launched a fully-fledged banking operation in Pakistan, opened an office in Turkey, acquired a controlling interest in Bank of Khartoum in Sudan, and partnered with other UAE institutions to launch Emirates & Sudan Bank."

The strong performance by the bank was recognised over the year with a string of ten awards from UAE and international industry bodies, including the inaugural Mohammed Bin Rashid Business Award, in addition to the Banker M.E. Best Sukuk House Award and Best Islamic Bank in Middle East. Other awards were won by the bank in various categories, including IT, customer service and human resources.

Dr. Kharbash also highlighted the ongoing Emiratisation programmes and investment in national human capital at the bank. He said: "Within the UAE, we are rated as the Employer of Choice not only amongst the UAE national workers but also in the industry. With 43 per cent of our workforce now UAE national, we have one of the highest percentages of Emiratisation in the industry."

DIB's human resources policy was recognised with three awards inn 2005: The Dubai Human Development Award, the Sharjah Human Development Award for Banking sector, and Recognition by the GCC Labour and Social Affairs Ministers' Council for the bank's efforts in achieving one of the highest Nationalisation results

Dr. Kharbash then turned to the future: "With the ongoing strong demand for both retail and institutional Islamic products, DIB's hard-earned reputation for excellence will enable it to maintain its position as the world's leading Islamic provider of financial services. Not with stranding the increasingly competitive environment, we are confident that the DIB success story will continue into 2006 and beyond. We foresee continued strong growth both at home and abroad, and will maintain the dynamic growth strategy that has served our shareholders and customers so well."