Bank of Sharjah today announced its financial results for the six months ending June 30, 2013. The Bank’s net profit for the first half of 2013 registered a 15% increase to reach AED 144 million, driven by the strength of its balance sheet and the soundness of its asset quality. The Bank continued to strengthen the structure of its balance sheet and grow its loan book while at the same time maintaining its strong liquidity position.

Total assets reached AED 22,673 million, an increase of 8% over the corresponding June 30, 2012, figure of AED 21,019 million.

Loans and Advances reached AED 12,895 million, 7% above the corresponding June 30, 2012, figure of AED 12,049 million. Compared to the December 31, 2012, figure of AED 12,444million the loan book grew by 4%.

Moreover, the Bank continued to growits deposit base which reached AED 16,644 million as of June 30, 2013, 11% over the corresponding June 30, 2012, figure of AED 15,031 million. Compared to the December 31, 2012, figure of AED 16,476 million, the growth in deposits was 1%.

The loans-to-deposits ratio further improved by 4% during the period to 0.77 as of June 30, 2013,compared to 0.80 in June of 2012, thereby leading to the25% increase in the Bank’s net liquidity. Net liquidity stood at AED 5,916 million as of June 30, 2013,versus AED 4,719 million as at June 30, 2012. The Bank’s Capital AdequacyRatio reached 22.04% as of June 30, 2013,compared to 21.88% on June 30, 2012.

Net interest income for the period ending June 30, 2013, increased by 1% despite the 11% increasein deposits. This increase was driven by improved interest margins in addition to the 7% increase in the loan book.

Non-interest income for the period ending June 30, 2013, improved by 63% on the back of higher commissions mainly on the tradefinance related activities as a result of the burgeoning UAE economy. Furthermore, the improvement witnessed by the UAE financial markets in light of positive economic indicators has increased the investment income generated by the Bank’s investment portfolio. As a result, non-interest income reached AED 111 million for the period ending June 30, 2013, compared to AED 68 million in the corresponding 2012 period.

All the above led to the 19% increase in the earnings per share and the 15% increase in net income for the period which reached AED 144 million compared to AED 125 million in the corresponding 2012 period. While comprehensive income surged by 39% driven by the unrealized gains on the non-trading investment portfolio whose results are only reflected in equity.

Commenting on the results, Mr. Varouj Nerguizian, the Bank’s Executive Director and General Manager, said: “The Bank’s prudent and conservative policy has allowed it to weather the financial crisis and enhance its liquidity and capital adequacy, in addition to ensuring its long term sustainability and potential. Nonetheless, this conservative policy did not stop the Bank from expanding its branch network and augmenting its private banking and wealth management services during 2012. This approach has given the Bank a competitive edge and has helped it benefit from the recent growth in the economy and enhance its profitability.”

Mr. Ahmed Al Noman, the Chairman, stated that:“The economic momentum in the UAE has taken a positive turn starting 2013. We are confident that the second half of 2013 will yield higher results backed by lower impairment as well as new financing transactions that will enhance the overall income stream”.