Dubai: Mashreq's net profit soared to Dh2 billion in the first quarter of 2024, marking a 25 per cent increase from last year, evidenced by a 7 per cent rise in loans and advances and a 6 per cent increase in customer deposits year-to-date.
The lender said in a statement that it was able to continue the "trends established last year", despite the new 9 per cent corporate tax imposed from January 1, 2024. On pre-tax basis, net profit stood at Dh2.3 billion, up 36 per cent year-on-year.
"This growth in operating income and net profit is primarily attributed to a 23 per cent year-on-year surge in net interest income. The main drivers include exceptional business growth, healthy client margins, the current interest rate environment, and low-risk costs. Additionally, non-interest income reached nearly Dh1 billion, representing an impressive 29 per cent growth year-on-year," Mashreq noted.
"The cost-to-income ratio improved by 3.5 per cent year-on-year, reflecting the bank's robust performance. This improvement is characterised by stringent control over operating expenses alongside continuous investments in client experience enhancements, risk management, and business expansion."
Additionally, operating profit rose from Dh1.8 billion to Dh2.3 billion in Q1 2024, a 31 per cent increase compared to the same period in 2023. Meanwhile, risk costs decreased by 61 per cent to Dh38 million, attributed to last year's accounting change concerning general provisions and prudent risk management.
The Return on Equity (ROE) reached 28 per cent in Q1 2024, "highlighting management's continued focus on driving efficiencies, accretive capital deployment, and creating optimal value for its shareholders," the company added.
