CFO’s Report
A record year for income and profits
In 2011, the Bank continued to build on its strong position, delivering robust performance with record levels of income and profit. The Bank significantly strengthened its capital position, improving liquidity levels and funding profile while remaining prudent in its risk management approach.
Deepak Khullar
Group Chief Financial Officer
2011 Highlights

  • Net profit amounted to AED 3,045 million, compared to AED 391 million in 2010
  • Encouraging revenue trends, diversified income growth with UAE-centric growth strategy
  • Total net interest and Islamic financing income increased 27 percent to AED 4,688 million and operating income grew 21 percent, reaching AED 6,069 million
  • Maintaining a solid balance sheet, controlled increase in loans and advances; loan to deposit ratio at 113.5 percent improved from 115.7 percent in 2010
  • Upward revision of ratings by Standard & Poor’s reflecting strong levels of capitalisation and liquidity, capital adequacy ratio was 22.51 percent compared to 16.65 percent in 2010 with liquidity ratio rising from 17.45 percent in 2010 to 22.13 percent in 2011
  • The Bank remained a net provider of liquidity to interbank markets at AED 18.8 billion at the end of the year
  • Cost to income ratio at 33 percent in 2011 compared to 31 percent in 2010 while continuing to invest in our businesses – in particular cash management, trade finance, treasury, and relaunching our Islamic
    Banking Business
  • Improved asset quality, with reported NPLs reduced to 4.6 percent in 2011, compared to 11.1 percent (5.8 percent excluding Dubai World exposure) in 2010
  • Portfolio impairment allowance balance was AED 2,059 million, or 1.59 percent of credit risk weighted assets as at 31 December 2011
  • Exposure to investments in CDS were substantially reduced from AED 1,457 million at 31 December 2010 to AED 55 million at 31 December 2011
  • In light of the record financial results, the Board of Directors has recommended a 20 percent cash dividend of AED 1,119 million, equivalent to 37 percent of net profit

Deepak Khullar
Group Chief Financial Officer