Mashreq bank’s Q4 net profit tumbles 21 per cent
* Q4 net profit AED441 million vs AED556m year-ago
* Sixth quarter in a row of falling profits
* Loans and advances up 1.4 per cent, deposits rise 4.6 per cent
Mashreq, Dubai’s third-biggest bank by assets, reported a 20.7 percent fall in fourth-quarter net profit on Wednesday, its sixth quarter in a row of falling profits, as fees and commission slipped and impairment allowances jumped.
The lender made a net profit of 441 million dirhams ($120 million) in the three months to Dec. 31, it said in a statement, down from 556 million dirhams recorded for the corresponding period of 2015.
Banks in the United Arab Emirates are facing stronger headwinds as a sag in oil prices feeds through to higher levels of bad loans and squeezed net interest margins.
Mashreq said it made impairments for bad loans worth 425 million dirhams in the fourth quarter, up 34 percent from the same three months of last year.
Loans and advances at the end of December were 1.4 percent up on the same point of 2015 at 61 billion dirhams, while deposits over the same period grew 4.6 percent to 77 billion dirhams.
Net interest income and net income from Islamic products rose 2.3 percent from a year earlier to 891 million dirhams, while net fee and commission income dropped 8.2 percent to 392 million dirhams, the bank said.
For the full-year of 2016, the bank reported a net profit of 1.9 billion dirhams, down from 2.4 billion dirhams a year earlier.