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Industrial and Commercial Bank of China Middle East achieves 116% profit increase in H1 2011

United Arab Emirates: Tuesday, August 23 - 2011 @ 12:28

Tian Zhiping, CEO, ICBC Middle East said, “Our results for the first half of 2011 confirm our strong confidence for the long-term growth potential of regional markets. Despite the political turbulence in the Middle East and North Africa we maintained significant growth across all areas of our business and we remain committed to pursuing our growth strategy for the region by increasing the scale of our existing business, broadening our range of products and services and expanding into new markets in the Middle East.”

“ICBC is the world’s biggest lender providing increasing support for regional economic development with a focus on petroleum, construction, telecommunications, aviation and natural resources. We are also well-positioned to facilitate the rapid growth of trade and investment between the Middle East and China,” Tian Zhiping added.

Despite the regional unrest and the continued global economic downturn, ICBC Middle East recorded increased operating revenue of $19m, an increase of 80% compared to same period last year. First-half profits rose to $14m, a year-on-year increase of $8m or 116%. The balance sheet is strong with a robust increase in interest earning assets which increased by $1,250m, and are expected to contribute further to profit in the second half of this year.

In March 2011, ICBC launched its Cross-Border Renminbi (RMB) Trade Settlement business in the Middle East which is already accelerating the growth of the bank’s total assets. The service was introduced in response to strong client demand and provides RMB settlement, purchase/sale and trade finance, as well as ‘overseas loans against domestic guarantee’ arrangements for its Chinese corporate clients and local clients. The rapid growth of ICBC’s Cross-Border RMB Trade Settlement business is indicative of the development of bilateral trade and investment between the Middle East and China which ICBC is ideally-placed to support.

Deposits increased by 110% in the first half of this year, compared to the year end of 2010. Current deposit constitutes 81.41% of total customer deposit.

Fee income (including handling fees and commission fees) and net interest income are two drivers of ICBC’s increase in revenues in the first half of 2011. Net interest income, the largest source of revenue, stood at $26m. In addition, fee income grew to $7m, representing an increase of $5m or 337% compared to the same period in 2010.

Growth plans

ICBC Middle East will continue to optimize its network in the region, keeping commercial banking as its main business while developing its investment banking and asset management services. The bank has plans to develop a retail banking business in the UAE, subject to regulatory approval, and also intends to expand further in the Middle East prioritising the growth of its business in Qatar and expansion into the Kingdom of Saudi Arabia and Kuwait.

Tian Zhiping added, “ICBC is committed to increasing significantly its support for and involvement with the long-term economic development of the Middle East. We are also ideally-placed to work in partnership with more companies from the Middle East that are looking to expand their business in China, as well as supporting the growing number of Chinese companies transacting business in this region.”

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Tuesday, August 23- 2011 @ 12:28 UAE local time (GMT+4) Replication or redistribution in whole or in part is expressly prohibited without the prior written consent of Mediaquest FZ LLC.

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