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United Arab Bank announces financial results for first nine months of 2014

United Arab Bank P.J.S.C (“UAB” or “the Bank”) announces its Financial Results for the nine months ended 30 September 2014.

UAB, recently recognized as the fastest growing bank in the region, announces a net profit of AED498m for Q3 2014, an increase of 20% over the same period in 2013.

Sheikh Faisal Bin Sultan Bin Salem Al Qassimi, Chairman of the Board of Directors said, “United Arab Bank continues to impress, with Q3 2014 results reconfirming the solid foundations of the bank’s business model. At UAB, we strive to continually grow in this highly competitive market, as evidenced through our recent recognition as the fastest growing bank in the Middle East.”

Mr Paul Trowbridge, Chief Executive Officer commented on the Bank’s Q3 results, “I am pleased to report continuous income and profit growth in Q3 2014 in comparison to prior year. UAB’s growth trajectory remains on track, whilst adhering to our customer centric-strategy. Our strong momentum is driven from sustained improvement in business mix and efficiency of our funding which has ultimately led to significant increases in our Customer Deposits and Loans & Advances Portfolios.

“UAB has achieved much over the past 9 months which included being honoured several times with awards including “best customer loyalty program” and “fastest growing bank in the UAE and the Middle East”. The awards received are testament to the banks significant progress and success as well as a true reflection of the strength of our brand and commitment to our customers. “

Impressive Performance

The Bank generated Operating Profit of Dhs735m, a 40% uplift over the same period in 2013. Total Income increased at an equally significant rate of 37% to Dhs1.03bn, with solid performance across both Net Interest Income and Non-Interest Income, up 33% and 51% respectively versus Q3 2013.

Non-Interest Income, a general benchmark evidencing the depth of customer relationships, expanded strongly in Q3 2014 to Dhs282m, driven primarily by Net Fees & Commissions (Dhs93m). With Non-Interest Income representing 27% of Total Income, our strategic emphasis on building and developing customer relationships continues to reap rewards.

Operating Expenses for the first nine months were AED298m versus Dhs229m for the same period in 2013, and remain in line with management expectations.

Nevertheless, despite UAB’s sustained investment to improve the overall customer experience and developing infrastructure to support future growth, the Bank’s Cost : Income Ratio improved to 28.8%.

Provision charges YTD 2014 were Dhs237m, compared to Dhs110m for the same period in 2013, with the booking of General Provisions to ensure compliance with Central Bank requirements. In parallel, the Bank continues to take a cautious and proactive approach to risk management, with our track record of growing our asset portfolio whilst maintaining quality evidenced by our robust Non-performing Loan Ratio (2.2%) and Coverage Ratio (106%) as at 30 September 2014.

Total Loans & Advances improved by 21% to Dhs18bn versus Q3 2013, with growth across all business units. Similarly, Customer Deposits increased by 31% in the same period to stand at Dhs18bn, further reinforcing the depth of our customer relationships and ongoing sustainability of UAB’s growth strategy.

AWARDS & RECENT DEVELOPMENTS
H1 2014 Recap

February – launched an Online Trade Portal to transform the ease and speed with which Corporate and SME customers can complete an array of trade finance transactions.

March – received 2 prestigious awards from Banker Middle East magazine: ‘Best Customer Loyalty Program’ for 2nd consecutive year; ‘Best Premium Card’ for UAB’s VISA Infinite product;

June ¬- UAB reaffirmed its market leading position by being recognised as both the ‘Fastest Growing Bank in the UAE’ and ‘Fastest Growing Bank in the Middle East’ at CPI Financials Banker Middle East Industry Awards for 2014.

June – signed an exclusive 5 year agreement with global insurer Zurich to market and cross-sell their general insurance products to our customers across the UAE.

June – announced the completion of a 3 year syndicated Murabaha facility worth US$100m with four banks based in the UAE, Bahrain, and Kuwait, with the facility marking the first Islamic syndication completed by UAB and the first syndicated Murabaha raised in the UAE.

Q3 2014 Achievements

September – the Bank embarked on a drive to expand its ATM network across the country based on geographic, demographic & commercial factors. With these new installations, our network of ATMs in the country now stands at 51.

September – the Bank was pleased to yet again be the sole official banking partner of ‘GITEX Shopper’ for the Autumn edition of the region’s largest and much-anticipated consumer electronics retail platform in the Middle East with electronic retailers and world class brands.

Mr Trowbridge concluded, “We continue to reshape and reposition our operations whilst delivering outstanding financial results. Moving forward, our positive outlook and strong position enable us to continue delivering innovative offerings that meet the needs of our customers, whilst in parallel reflect our ongoing commitment to the UAE community. We have strong confidence in continued increased growth for UAB and the Board remains positive for the remainder of the year.”

The Bank is rated by Moody’s as Baa1 with a stable outlook.