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Q3 2023 Financial Results

24/10/2023

RAKBANK delivers highest ever Net Profit of AED 1.35B for YTD Sep’2023, up 54% year on year

Ras Al Khaimah, United Arab Emirates, 23 October 2023 – The National Bank of Ras Al Khaimah (RAKBANK) today reported its financial results for the first nine months of 2023

Click here to view the full Q3 Financial Results.

Q2 2023 Financial Results

25/07/2023

Click here to view the full Q2 Financial Results.

Q1 2023 Financial Results

26/04/2023

RAKBANK more than doubles its quarterly Net Profit at AED 450M for Q1’23 on the back of strong income growth

Ras Al Khaimah, United Arab Emirates, 26 April 2023 – The National Bank of Ras Al Khaimah (RAKBANK) today reported its financial results for the first quarter of 2023 (“Q1’23”)

RAKBANK delivered a Net Profit increase of 105% for Q1 2023 driven by a robust and diversified growth on both sides of the balance sheet. This was underpinned by strong sales momentum and lower cost of funds.

Total Income performance was supported by a strong net interest income of AED 788.8M, up 46.0% YoY. Net interest margins increased to 4.9% against 3.8% (Q1’22) and continues to be among the highest in the Industry. Q1’23 non-interest income of AED 284.4M, up 52.5% YoY. The growth in non-interest income was driven by higher forex and derivative income.
Gross loans & advances at AED 38.7B, reflecting a 1.4% increase compared to 31 December 2022 on the back of a changing balance sheet mix in line with the strategic direction of the bank.
Customer deposits stood at AED 46.4B, an increase of 3.3% compared to 31 December 2022. The Bank has a strong Current & Saving Account (CASA) franchise with the CASA ratio of 70.5%.
Cost of Risk remained low due to the Bank’s diverse business mix and resilient UAE economic environment, leading to a 30.9% reduction in impairments as against Q4’22. Impaired Loan provision coverage ratio increased to 192.1% against 137.8% in Q1’22, remaining one of the strongest in the industry.

The Bank achieved balanced growth across all Business Segments:

Personal Banking:

Gross loans & advances at AED 19.1B are up 1% YoY and +2% against FY’22 driven by the sales momentum across products with balance sheet for Auto loans +6%, Mortgages +5% and Personal loans +0.3%.
Customer deposits of AED 16.7B, are up 22% YoY and +6% during the quarter driven by higher Term deposits +30% & CASA +0.3%.
Q1’23 income supported by net interest income of AED 229M, +19.0% YoY and non-interest income of AED 123M, +1% YoY.

Business Banking:

Gross loans & advances of AED 9.3B, are up 12% YoY and +3% against FY’22 mainly through higher volumes for Rak business loans +5%.
Customer deposits of AED 19.7B, are up 14% YoY and +7% during the quarter driven by higher CASA deposits +7% & Term deposits +2.7%.
Q1’23 income supported by net interest income of AED 337M, +57.0% YoY and non-interest income of AED 77M +6% YoY.

Wholesale Banking & Others:

Gross assets (including lending to banks) of AED 19.8B, are up 13% YoY and +1% against FY’22 mainly driven by higher FI bank lending +2%.
Customer deposits of AED 9.9B, are up 13% YoY and +7% during the quarter.
Q1’23 income supported by net interest income of AED 224M, +68.0% YoY and non-interest income of AED 84M against a loss of 8Mn in Q1’22.

RAKBANK delivered strong shareholder returns with ROE of 19.4% and ROA of 2.8%, and remained highly liquid and well capitalized.

The Bank’s Capital Adequacy Ratio (CAR) was at 16.8%.
The regulatory eligible liquid asset ratio at 14.8%, compared to 12.8% as at 31 December 2022, and the advances to stable resources ratio stood comfortably at 81.8% compared to 79.7% at the end of 2022.
Cost-income ratio improved to 36.2% driven by strong cost discipline, automation and digitization.
The Bank’s non-performing loans ratio improved to 3.0% against 3.6% in Q1’22.

Raheel Ahmed, CEO of RAKBANK said, “Delivering on our multi-year strategy, we accelerated our growth and achieved a record net profit of AED 450M and a record total income of AED 1,073M for the quarter. In addition to this impressive growth, I am very pleased with the progress we are making in laying the foundation for sustainable growth.

In diversifying our income sources, we achieved robust growth on both sides of the balance sheet, across interest and fee incomes, and in all our segments. In terms of building deeper customer relationships, we achieved strong growth in digitally active customers with digital transactions growing by 12% YoY. Our high CASA ratio in our deposit base of 70.5% despite the high interest rate environment is a testament of the strong relationships we built with our customers and clients. We enhanced our operational leverage and improved our cost-income ratio through our strong cost discipline, and our cost of risk reduced via diversifying our business mix. The Bank remains well capitalized and liquid with a Capital Adequacy Ratio of 16.8% and an Eligible Liquid Asset Ratio of 14.8%. As a result of our progress, we achieved an ROE of 19.4% and ROA of 2.8%.

Being one of the largest SME banks in the UAE, we continue to back entrepreneurs and start-ups by opening more than 4,000 business accounts in Q1 2023, of which 1,600 accounts were opened for start-ups. Similarly, we disbursed AED 571M in business loans, out of which AED 394M were disbursed for new business loan customers.

As we grow, we are investing heavily in technology while maintaining cost discipline to digitize customer journeys, upgrade core data architecture, and revamp compliance and risk infrastructure. This investment will enable RAKBANK’s journey to provide a superior customer experience that is characterized by its hyper-personalization and relevance. The recent launch of our first fully digital accounts opening capability with straight-through processing is a good example of how we are digitizing our customer journeys.

Continuing from Q4 2022, we are focusing on expanding strategic hires to lead our growth, and we remain committed to and supporting the career aspirations and ambitions of our colleagues. Special attention is drawn to developing our Emirati talents as we align ourselves to the UAE leadership’s mission of growing and nurturing local talent.

As one of the nation’s leading financial institutions, RAKBANK recognizes our responsibility to support the ‘UAE Net Zero by 2050’ initiative. The team is actively engaged with RAK Government on COP28 submissions, working on financial inclusion and reducing emissions. We continue to support financial inclusion and accelerate digital remittances through our wages protection system partner and the United Nations Capital Development Fund.

Lastly, our outlook for FY 2023 remains positive yet cautious, with the buoyant UAE economy and uncertain global macro set up as backdrops. While we closely monitor the headwinds of inflation, rising interest rates, geopolitical developments, we will continue building on the Bank’s strengths and remain committed to delivering on our strategy.”

Financial Highlights for Q1 2023

Profitability Growth supported by Income momentum and improvement in

Provisions

Net Profit increased by 104.6% to 450.3M (vs Q1’22 104.6% and Q4’22 58.2%).
Net Interest Income and Income from Islamic products net of distribution to depositors increased by 46.0% to AED 788.8M (vs Q4’22 7.6%).
Interest income from conventional loans and investments increased by 79.7%, while interest costs on conventional deposits and borrowings increased by 300.5%. Net income from Sharia-compliant Islamic financing increased by 7.8%.
Non-Interest Income increased by 52.5% to AED 284.8M (vs Q1’22 52.5% and Q4’22 8.7%), primarily due to forex and derivative income booked in Q1 2023.
Total Income increased by 47.6% (vs Q4’22 7.9%), benefiting from the balance sheet growth momentum.
Operating Expenditure was AED 389.0M (vs Q1’22 AED 372.4M), reflecting a 4.5% increase compared to the same period in 2022, and a 4.7% increase compared to Q4 2022, due to the Bank's growth investments.
Operating Expenses increased mainly due to higher staff costs, card expenses, and other operating expenses. However, these were partly offset by lower IT expenses, occupancy costs, depreciation, and communication expenses.
Cost-to-Income ratio for the bank decreased to 36.2% (vs Q1’22 51.2% and Q4’22 37.3%).
Provision for credit loss increased by 73.9% to AED 233.9M for Q1 2023 compared to Q1 2022, due to prudent precautionary measures in anticipation of expected developments. However, compared to Q4 2022, the provision for credit loss decreased by 30.9% for Q1 2023.
Net Credit Losses to average loans and advances closed at 2.5% (vs Q4’22 3.4%).

Balance Sheet crosses AED 68.9B with a strong uptick across all customer segments

Balance sheet crosses AED 68.9B as the Total Assets increased by AED 2.5B compared to 31 December 2022 reflecting a growth of 3.8%, with an increase in Cash/Central Bank balances by AED 929.2M, Investments by AED 805.8M, Gross Loans and Advances by AED 551.9M and Lending to Banks by AED 480.3M as compared to 31 December 2022.
Business Banking portfolio increased by AED 264M, Retail Banking by AED 286.2M and Wholesale Banking segment (including bank lending) increased by AED 211M compared to 31 December 2022.
Business Banking recorded 2.9% growth compared to 31 December 2022 with Business Loans growing by 5.3% and an increase of 1.5% on the Trade and Working Capital Loans portfolio.
Retail Banking reflected a growth of AED 286.2 M supported by a strong sales momentum across products with Mortgages growing by 4.8% and Auto Loans by 6.4%.
Non-performing Loans and Advances to Gross Loans and Advances ratio remained same at 3.0% as at 31 March 2023 compared to 31 December 2022.

Robust Growth in Customer Deposits as we continue to be the main bank for most of our customers

Q1’23 Customer deposits increased by 3.3% compared to 31 December 2022, mainly due to an increase of AED 1,089.5M in CASA deposits and AED 404.7M in time deposits, endorsing the trust our customers place in RAKBANK’s solutions and services. RAKBANK has built a strong CASA franchise with a CASA ratio of 70.5 % as at 31 March 2023.

Strong Capital and Liquidity position

The Bank’s Capital and Liquidity ratios remained strong.
With a Total Capital Ratio as per Basel III, after the application of prudential filter, at 16.8% compared to 16.4% at the end of 2022.
The regulatory eligible liquid asset ratio at the end of 31 March 2023 at 14.8%, compared to 12.8% as at 31 December 2022, and the advances to stable resources ratio stood comfortably at 81.8% compared to 79.7% at the end of 2022.

Healthy Cash Flows from operating activities

Cash and cash equivalent as at 31 March 2023 were AED 4.7B compared to AED 4.3B as at 31 December 2022.
Net cash generated from operating activities was AED 1.2B, AED 819.8M was used in investing activities and AED 4.7M used in financing activities.

Impact of Projected Capital Expenditure and developments

The Group incurred AED 37.3M in capital expenditure in Q1 2023.
RAKBANK will carry on advancing its investment towards customer-centric technology transformation.

Ratings

RAKBANK gets continuously rated by leading rating agencies with their latest ratings shown in the table below. This rating reflects the institutional strength of the Bank that is backed up by trust and transparency in financial reporting.

RAKBANK reports net profit of AED 1,163.4M for 2022

13/02/2023

RAKBANK delivers the highest annual profit growth in over a decade with a Net Profit of AED 1,163.4M and a growth of 53.4% YoY

Highlights Q4/Full Year ended 31 December 2022

Highest net profit growth rate in over a decade. A high single digit income growth supported by robust increases on both sides of the balance sheet.

FY’22 net profit of AED 1,163.4M, up 53.4% YoY. Q4’22 net profit of AED 284.6M, up 27.3% YoY.
FY’22 total income of AED 3,451.8M, up 6.9% YOY, with Q4’22 total income of AED 994.8M, up 25.5% YoY.
Total income for FY’22 was supported by a strong net interest income of AED 2,489.3M, up 14.8% YoY with Q4’22 net interest income of AED 733.1M, up 34.0% YoY. The FY’22 non-interest income was AED 962.5M, lower by 9.4% YoY mainly due to lower trading profits in Q1’22. The non interest income for Q4’22 was AED 261.6M, up 6.7% YoY.
A well-diversified balance sheet and resilient UAE economic environment led to a 25.3% reduction in impairments as against FY’21. The impairments for Q4’22 reflect an increase of AED 141M against Q4’21 largely on account of prudent management overlays in anticipation of the expected developments in the fast evolving regulatory landscape, uncertain global economy & rising interest rate environment.
Gross loans & advances at AED 38.1B, reflecting a 7.6% increase YoY on the back of a changing balance sheet mix in line with the strategic direction of the bank.
Customer deposits stood at AED 44.9B, an increase of 15.3% YoY.

Healthy returns whilst remaining well capitalized and having one of the best provision coverage ratios in the industry.

The return metrics remained strong with ROA of 1.9% and ROE of 13.5% for FY’22 as against a 1.4% and 9.5% respectively for FY’21.
The Bank remained well capitalized with a Capital Adequacy Ratio (CAR) of 16.4%.
Net interest margins increased to 4.1% against 4.0% (FY’21) and continues to be among the highest in the Industry.
The Bank’s non-performing loans ratio improved to 3.0% against 4.0% for FY’21.
Impaired Loan provision coverage ratio increased to 181.7% against 133.7% last year, remaining one of the strongest in the industry.

Continued focus on maximizing shareholder returns

The Board of Directors recommended distribution of a cash dividend of 34 fils per share for the shareholders’ consideration and approval at the Annual General Meeting (AGM).

Just as the UAE economy accelerated its post-COVID recovery in 2022, RAKBANK’s performance has entered a new and transformative era of growth. Following this strong recovery, we are now on track for sustained expansion underpinned by targeted investments and a sharp focus on fiscal and operational resilience.

As a leading financial institution in the UAE, RAKBANK recognizes the important role we play in supporting the country’s vision and growth for the year 2050. We are committed to investing in technology and innovation to drive financial inclusion and create a more diverse and sustainable economy. We understand the importance of supporting the career growth and development of Emiratis and strive to provide them with empowering programs aimed to contribute to their personal growth and that of the UAE economy.

Looking ahead, we foresee 2023 to be a year of opportunity in the midst of uncertainty caused by geopolitical and economic headwinds. Therefore, we will diversify our business mix and further strengthen our credit profile and lay the foundation of a long term, sustainable growth.
Through the execution of our latest multi-year strategic plan, we will build on the Bank’s existing strengths, while continuing to transform the Bank to navigate through a challenging external environment, and ultimately exceed the expectations of our customers.
By accelerating our digital transformation, we will continue to build digital journeys that enable fast, easy, personal, and relevant customer experiences. These outcomes are fundamental to the Bank’s continued success.

RAKBANK delivered a net profit of AED 1,163.4 M, completing a marquee year of recovery and growth with a 53.4% YoY increase – achieving its highest annual growth rate in net profit since 2008. The growth was diversified across all of our segments, and was accompanied by growths in total assets of 15.5%, loans & advances of 7.6%. It is also worth noting that customer deposits grew by 15.3% YoY and CASA ratio was 70.4% as at 31 December 2022 – an important achievement given the rising interest rate environment.

We have seen balance sheet momentum across Wholesale Banking and Business Banking segments that grew by AED 1,589.1M (18.3% YoY) and AED 996M (12.4% YoY) respectively. We also saw Retail Banking grow by AED 102.8M (0.5% YoY).
This stand out performance marks the year of reset.

A reset of performance: where we have achieved a V-shaped recovery by curbing the declines in the pandemic years. We re-ignited growth in both sides of the balance sheet, while prudently managing costs and strengthening our capital position to achieve an ROE of 13.5%.
A reset of strategy: where the Board, the management and employees across the Bank set out our vision to become the ‘digital bank with a human touch with our customers in their key moments of truth’, and defined the strategic programs to achieve that vision.
A reset of the way we work: working as one team, across departments front to back, towards a common goal with clear ownership and accountability.

With the successful completion of the reset phase, now it is time to deliver on the new strategy. We will continue to develop a sustainable business mix including growing the contribution of ‘lower risk’ segments such as Wholesale Banking, Commercial Banking and the Affluent Segment. We will change the way the Bank generates revenue by reducing our reliance on unsecured lending and increasing the proportion of fee and non-financing income as well as driving cross-sell across all segments. Finally, we will create a more scalable business by making investments to enhance our digital journeys and capabilities and improve efficiency in both customer acquisition and servicing.

As we work on these strategic deliverables, we continuously remind ourselves of our north star to stay ahead of the curve in customer experience. We understand that the hallmarks of a superior customer experience are hyper-personalization and relevance, achieved through harnessing the power of data and analytics. To this end, we at RAKBANK will continue to make strides in building trusted partnerships with our customers, as we believe this is ultimately the way we compete - and win.

Financial Highlights for Q4/FY 2022:

Balance Sheet Highlights:

Key Ratios:

*Annualized
**After application of Prudential Filter
Figures in brackets represent unfavorable movements

Key Highlights

Profitability Growth supported by Income momentum and improvement in Provisions

Balance Sheet crosses AED 63B with a strong uptick across customer segments

Balance sheet crosses AED 66.5B as the Total Assets increased by AED 8.9B YoY reflecting a growth of 15.5%, with an increase in Lending to Banks by AED 3.0B, Gross Loans and Advances by AED 2.7B, Investments by AED 2.0B and Cash/Central Bank balances by AED 819.8M as compared to 31 December 2021.
The Wholesale Banking portfolio increased by AED 1.6B, Business Banking by AED 1.0B and Retail Banking segment increased by AED 102.8M compared to 31 December 2021. Wholesale Banking reflected a strong growth of 27% YoY on the back of a resilient economic environment in the UAE, fueled by the banks strategic balance sheet diversification roadmap.
Business Banking recorded 12.4% growth YoY with Business Loans growing by 11.4% and an increase of 13.0% on the Trade and Working Capital Loans portfolio.
Retail Banking reflected a growth of AED 102.8M supported by a strong sales momentum across products with Mortgages growing by 6.2%, Auto Loans by 4.4%, Credit Cards by 3.8% and the balance sheet decline on the Personal Loans front being restricted for FY’22. The overall growth on the Retail Banking was subdued by a drop on loans against investments and other retail loans marred by a rising interest rate environment as compared to 31 December 2021.
Non-performing Loans and Advances to Gross Loans and Advances ratio declined to 3.0% as at 31 December 2022 compared to 4.0% as at December 2021.

Strong Growth in Customer Deposits as we become the main bank for more of our customers

Customer deposits increased by 15.3% compared to 31 December 2021, mainly due to an increase of AED 3.7B in time deposits and AED 2.2B in CASA deposits, endorsing the trust our customers place in RAKBANK’s solutions and services. RAKBANK has built a strong CASA franchise with a CASA ratio of 70.4 % as at 31 December 2022.

Comfortable Capital and Liquidity position

The Bank’s Capital and Liquidity ratios remained strong.
With a Total Capital Ratio as per Basel III, after the application of prudential filter, at 16.4% compared to 17.0% at the end of 2021.
The regulatory eligible liquid asset ratio at the end of 31 December 2022 at 12.8%, compared to 11.6% as at 31 December 2021, and the advances to stable resources ratio stood comfortably at 79.7% compared to 82.8% at the end of 2021.

Healthy Cash Flows from operating activities

Cash and cash equivalent as at 31 December 2022 were AED 4.3B compared to AED 3.3B as at 31 December 2021.
Net cash generated from operating activities was AED 5.3B, AED 2.6B was used in investing activities and AED 1.7B used in financing activities.

Impact of Projected Capital Expenditure and developments

The Group incurred AED 82.6M in capital expenditure primarily focused on implementing and embedding Consumer Protection Framework while enhancing our AML / CFT systems, and investing in digital experiences.
RAKBANK will carry on advancing its investment towards customer-centric technology transformation.

2022 was full of developments for RAKBANK and marked by achievements and transformation

Ratings

RAKBANK gets continuously rated by leading rating agencies with their latest ratings shown in the table below. This rating reflects the institutional strength of the Bank that is backed up by trust and transparency in financial reporting.

Rating Agency	Last Update	Deposits	Outlook
Moody’s	November 2022	Baa1 / P-2	Stable
Fitch	November 2022	BBB+ / F2	Stable
Capital Intelligence	August 2022	A- / A2	Positive

RAKBANK to accelerate AI strategy in UAE partnering with DataRobot and e&enterprise

15/12/2022

RAKBANK today announced that it has partnered with global AI Cloud leader, DataRobot and local AI service provider e&enterprise, to build and deploy industry leading AI platform to accelerate its artificial intelligence and machine learning- driven analytics.

As RAKBANK progresses its strategic ambition to meet the rapidly evolving customer needs through harnessing the power of data and analytics, a leading AI platform will be an important enabler. DataRobot, with its proprietary approach to MLOps and proven track record serving the majority of the leading financial institutions of the world, will assist in RAKBANK’s analytics and data transformation journey. This partnership also marks the first ever deployment of Data Robot’s AI platform in a financial institution in the region.

Raheel Ahmed, Chief Executive Officer of RAKBANK, said: “RAKBANK’s data and analytics transformation journey will help us engage our current and prospective customers with hyper-personalized and relevant offers and communication. To do this, leveraging AI and Ml tools to maximize the power of data and analytics, and upgrading our capabilities through data democratization and cutting-edge Al platforms will be crucial. We will continue to develop our AI and ML capabilities so that it becomes a key source of the Bank’s competitive advantage.”

Debanjan Saha, Chief Executive Officer of DataRobot, added: “RAKBANK is leading the banking industry with their focus on leveraging AI to optimise many aspects of their business. By choosing the DataRobot AI Cloud Platform and the expertise of the DataRobot team and our strategic partner e& enterprise in the region RAKBANK can further accelerate their AI initiatives and drive transformative change for their organisation. We’re excited to work with such an innovative organisation and look forward to helping them make better, faster, and smarter business decisions guided by AI.”

“At e& enterprise, we are committed to enable industry verticals with AI solutions and services by building a local ecosystem and capabilities. Digital transformation has also accelerated in the banking sector with changing customer demands and the need to create business value. It’s great to collaborate on this project for RAKBANK on its AI adoption journey where they benefit from the digital footprint and managed services expertise of e& enterprise, coupled with DataRobot’s AI platform capabilities” said Alberto Araque, CEO e& enterprise IoT & AI.

DataRobot AI Cloud is one of the most widely deployed AI platforms for end-to-end management of model life cycles. DataRobot brings together diverse data and hundreds of data scientists who continuously develop adaptable models to upgrade all aspects of RAKBANK’s businesses including support of growth agenda, risk management and compliance. DataRobot currently works with 40% of the Fortune 50 companies and their clientele includes 40% of the top global banks.

RAKBANK partners with ADGM to offer dedicated banking services

15/11/2022

RAKBANK and Abu Dhabi Global Market (ADGM), the international financial centre of the capital of the UAE, have signed a Memorandum of Understanding (MoU) to provide preferential banking services to ADGM-licensed entities. The agreement facilitates efficient bank account opening for all entities, including SMEs, exchange houses dealing in virtual assets, hedge funds and corporations.

Under the terms of the MoU, RAKBANK and ADGM will cover a range of service categories including Client Onboarding and Banking, Education and Engagement, Business Development Activities, Employee Banking and Digital Services. Through this agreement, RAKBANK aims to provide banking solutions to SMEs, start-ups, and corporations in sync with their growth objectives and opportunities.

Commenting on this partnership, Raheel Ahmed, CEO of RAKBANK said, “This partnership with ADGM is another step forward in our commitment to support and provide financing solutions to entrepreneurs and businesses in the UAE. RAKBANK is one of the leaders in business banking within the UAE, and this leadership has been built on our ability to create tailored solutions for businesses that drive growth, innovation and employment in the economy. I believe this partnership will equip businesses licensed within ADGM to access cutting-edge and quick banking solutions and services.”

The agreement will pave the way for corporations to capitalise on training and awareness programmes that are jointly provided by RAKBANK and ADGM. Furthermore, the partnership will focus on driving UAE national work placements by providing tailored financial training on SME financing and innovation.

Dhaher bin Dhaher Al Muhairi, CEO of the Registration Authority at ADGM said, “As a catalyst for growth, ADGM aims to develop a robust, business-friendly ecosystem and a regional centre of excellence for fi-nancial services talent development. We are pleased to further our collaboration with RAKBANK to de-velop a range of financial service solutions that support the needs of establishments based within our jurisdiction. We believe that this partnership mirrors the ongoing commitment of both organisations to-ward fostering and developing the finance industry within the emirate of Abu Dhabi and the UAE as a whole. With RAKBANK’s curated propositions, we look forward to strengthening the efficient banking system and providing continued support for the long-term development of the sector in the nation.”

RAKBANK will offer a simplified list of account opening requirements to ADGM licensed entities while also reducing the average turnaround time for operationalizing accounts and securing transaction services. The agreement also covers the provision to offer ADGM incorporated entities to house their USD banking and treasury needs through investment banking services such as structured loans, trade finance, cash management, and supply chain finance.

On the Fintech side, RAKBANK will co-host Digital Labs, Fintech-related events and workshops. Through RAKBANK’s engagement in Fintech Abu Dhabi as part of Abu Dhabi Finance Week and other ADGM Fintech initiatives, the two parties will explore open banking opportunities and develop a Fintech cooperation ecosystem. . RAKBANK will also invest in a dedicated help desk to service the needs of ADGM employees, its subsidiaries, and ADGM incorporated entities. The help desk will be the first touchpoint for all employee banking needs such as providing information, responding to inquiries, receiving complaints, and introducing employees to RAKBANK offers.

RAKBANK reports net profit of AED 878.8mn for the first 9 months of 2022

25/10/2022

RAKBANK reports net profit of AED 878.8mn for the first 9 months of 2022 up 64.4% YoY

Key Highlights Q3/9M ended September 2022

Highest net profit since Q3 2015 driven by diversified balance sheet & lower cost of risk in a robust macro-economic environment.

Net profit for the quarter amounts to AED 351.4M up 53.7% compared to Q3 2021, reflecting the highest quarterly Net Profit since Q3 2015.
Compared to Q3 2021, Total Income increased by 13.6% to AED 915.1M, supported by a strong increase of 19.5% for the Net Interest Income to AED 652.8M and an increase of 1.3% of the Non Interest Income to AED 262.3M.
Gross Loans & Advances totals up to AED 36.0B, showing an increase of 7.5% YoY and 5.3% YTD.
Customer Deposits stood at AED 40.3B, a boost of 8.8% YoY and 6.9% YTD.
Well diversified asset growth and continued improvement in the UAE’s economic environment led to a 47.1% YoY reduction in impairments.

Healthy returns whilst remaining well capitalized and having one of the best provision coverage ratios in the industry.

Net Interest Margins increased marginally to 4.0% and continue to be one of the highest in the Industry.
The Bank’s Non-Performing Loans ratio is at 3.2% and continues to improve.
Loan Provision coverage ratio is at 156.5% remaining one of the strongest in the industry.
Strong profitability metrics with annualized ROA and ROE of 2.0% and 13.9% respectively.
With Capital Adequacy Ratio (CAR) at 17.0%, the Bank remains well capitalized.

RAKBANK CEO, Raheel Ahmed, commented:

“This quarter we delivered a net profit of AED 351M, which is the highest since Q3 2015, as we continued on our path to sustainable growth & diversified business mix. Our operating Income is becoming well balanced and backed by robust balance sheet growth. We remain disciplined with cost, while reaping the benefits of our business mix shift through lower provisions. The RAKBANK team remains to be fully focused on providing the best service to our customers, while at the same time being relentlessly focused on delivering results.

In order to support the cross border trade and promote strategic initiatives that enhance the region’s payments infrastructure, we have partnered with Buna, the Arab Monetary Fund (AMF)’s payment platform.

We continue to back entrepreneurs and start-ups and opened more than 8,000 new accounts for them YTD. We have also offered financing solutions to more than 3,800 SMEs in the last nine months and helped 800 customers to buy their homes. Additionally we deepened existing relationships as evidenced by the growth in card spends and overall payments.

As a result of our customers’ confidence and trust, we have been recognized as UAE’s Mid-sized Domestic Retail Bank of the Year and UAE’s best SME Bank of the Year by the Asian Banking & Finance Awards. We also received the Best SME Bank in the UAE Award from the Global Finance Magazine and the Banking Excellence Awards.

This quarter’s net profit grew from strength to strength and our 9 months net profit recorded AED 879M, an increase of 64% YoY, as we benefit from income growth and stringent cost management.

Our income growth is driven by the Bank’s solid balance sheet momentum across all the segments, with Business Banking and Wholesale Banking growing by AED 906M (up 11%) and AED 687M (up 8%) respectively, while Retail Banking grew by AED 231M (up 1.3%). Customer Deposits increased by 9% YoY, outpacing the growth in Gross Loans and Advances, given the importance of Liabilities in a rising interest rate environment.

The continuing shift in the business mix to make our business more sustainable and resilient is resulting in the low level of Provision for Credit Loss that recorded AED 465M, marking a 47% decrease YoY.

Lastly, our digital transformation is starting to yield early results as our digitally active customers continued to increase by 7% YoY, while our digital transactions achieved a record growth of over 15% YoY."

Q3/YTD 2022 Management Discussion & Analysis

Financial Highlights for Q3/YTD 2022

Balance Sheet Highlights:

Key Ratios:

*Annualized
**After application of Prudential Filter
Figures in brackets represent unfavorable movements

Key Highlights

Profitability Growth supported by Income momentum and improvement in Provisions

Balance Sheet crosses AED 63B with a strong uptick across customer segments

Balance sheet crosses AED 63B as the Total Assets increased year to date by AED 7.5B reflecting a growth of 13.4%, due to an increase in Gross Loans and Advances by AED 1.8B, Cash and Central Bank balance increased by AED 1.9B, an increase in Lending to Banks by AED 2.0B and Investments growth by AED 1.3B.
A strong balance sheet drive was evident across all of the Bank’s segments. Lending in the Wholesale Banking increased by AED 687.1M, Retail Banking segment increased by AED 231.1M and Business Banking lending increased by AED 905.7M compared to 31 December 2021 respectively.
Wholesale Banking Segment reflected a strong YTD growth on the balance sheet of 7.9% on the back of strong advancement in the Financial Institutions portfolio.
The growth of the Retail Banking segment was supported by a strong sales momentum across products, with Mortgages growing by 3.5%, Credit Cards by 3.3%, Auto Loans by 4.0% and Personal Loans by 1.6%.
Business Banking segment recorded an 11.2% growth YTD backed by a 9.2% increase on Business Loans as well as a raise in the trade and working capital loans by 12.5%.
Non-performing Loans and Advances to Gross Loans and Advances ratio declined to 3.2% as at 30 September 2022 compared to 4.5% as at 30 September 2021 and 4.1% as at December 2021.

Strong Growth in Customer Deposits as we become the main bank for more of our customers

Customer deposits increased by 8.8% compared to 30 September 2021 and 6.9% compared to 31 December 2021 mainly due to an increase of AED 1.8B in CASA accounts and AED 759M in time deposits; thus further endorsing the trust our customers place in RAKBANK’s solutions and services.

Comfortable Capital and Liquidity position

The Bank’s total Capital Ratio as per Basel III, after the application of prudential filter was 17% which remained the same compared to the end of the previous year.
The regulatory eligible liquid asset ratio at the end of 30 September 2022 was 14.5%, compared to 11.6% as at 31 December 2021, and advances to stable resources ratio stood comfortably at 84.8% compared to 82.9% at the end of 2021.

Healthy Cash Flows from operating activities

Cash and cash equivalent as at 30 September 2022 were AED 5.1B compared to AED 2.3B as at 30 September 2021.
Net cash generated from operating activities was AED 4.9B, AED 1.9B was used in investing activities and AED 1.2B used in financing activities.

Impact of Projected Capital Expenditure and developments

The Group incurred AED 58.7M in capital expenditure primarily focused on implementing and embedding Consumer Protection Framework while enhancing our AML / CFT systems, and investing in digital experiences.
RAKBANK will carry on advancing its investment towards customer-centric technology transformation.

Further embedding ESG into RAKBANK’s Strategy and Mission

RAKBANK customers logged into our digital solutions over 9 million times in the third quarter of 2022, plus over 250,000 customers are digitally active. This further drives our strategic vision of creating a seamless digital journey for our customers.
As we continue to be our customers’ long term financial partner and remain by their side through any life changing event, we have introduced RAKBANK Money Assist not only to help them assess their debt situations and make sounder financial decisions but also to support them in planning, spending, and taking control of their finances.
Moreover, the Bank is working closely with the Ras Al Khaimah Municipality on an energy audit program for the industrial sector. The program will help industrial companies identify energy saving opportunities that will make them more environmentally friendly and competitive. The Bank’s role is to extend a credit facility to dilute these initiatives over time along with any other financial support that such companies may need when investing in the necessary equipment/gear to become energy efficient.
In 2021, the Bank’s Environmental, Social and Governance (ESG) framework was rated as BBB by Morgan Stanley Capital International (MSCI). For more details on the Bank’s ESG Framework and Approach the Bank urges the public to read the RAKBANK 2021 Annual Integrated Report.

Strategy Going Forward

RAKBANK has developed a refreshed 5-year strategy to build on the Bank’s existing strengths while creating sustainable growth across all key business lines and delivering a simply better customer experience.

Risk Management in the Current Economic Scenario

The global economic activity is experiencing an overall slowdown, with inflation growing exponentially. There are plenty of factors that contributed to the situation from the Russian-Ukraine conflict, the effects of COVID-19, Supply-chain challenges, and more.
According to the IMF, the global growth is forecast to slow from 6.0% in 2021 to 3.2% in 2022 and 2.7% in 2023. This is the weakest growth profile since 2001 except for the global financial crisis and the aftermath of the COVID-19 pandemic.
These factors are going to prompt greater caution at the Bank and risk focus as we tread cautiously into the last quarter of 2022 & into 2023.
The inflation increasing can have a ripple effect on the economy as it directly influences interest rates and borrowing costs. The Bank is looking for methods to offer continuous financial and non-financial support to its customers.

Ratings

Rating Agency	Last Update	Deposits	Outlook
Moody’s	May 2022	Baa1 / P-2	Stable
Fitch	April 2022	BBB+ / F2	Stable
Capital Intelligence	August 2022	A- / A2	Positive

RAKBANK joins cross-border payments platform Buna

04/10/2022

A centralized, risk-controlled, and secure platform providing real-time services to customers

United Arab Emirates, 03 October 2022 – RAKBANK announced that it has joined the Arab Monetary Fund (AMF)’s Buna payment platform today. In line with the Bank’s digital transformation strategy, this partnership aims to provide customers with an enhanced payment service platform for sending and receiving cross-border, multicurrency payments safely and securely.

Buna enables commercial banks, central banks, and other financial institutions, in the Arab region and beyond to send and receive payments in Arab currencies as well as key international currencies. It offers real-time services through a centralized, risk-controlled, and secure platform.

As RAKBANK is a participating Bank in Buna Payments platform, it will now have access to Real time Gross Settlement (RTGS) for foreign remittances offering an efficient, accessible, and risk-controlled payments process to its customers. The main objective is to harness the capabilities of the Buna payment platform to better serve its customers. This partnership will further strengthen the country’s regional cross-border payments sector and provide a seamless payment infrastructure.

Raheel Ahmed, Chief Executive Officer of RAKBANK, said: “Joining the Buna payments platform is a pivotal step in RAKBANK’s plan to support regional cross border trade. It is important for us to explore strategic initiatives that enhance the region’s payments infrastructure. As a customer-focused bank in the UAE, we understand the importance of convenience and speed when it comes to payments. This announcement is in line with our commitment to investing in smarter banking solutions and increasingly using technology to make our range of services more accessible to additional customers, wherever they are. We would like to thank Buna for their exceptional cooperation which has made this process easy and swift.”

Commenting on this, Mehdi Manaa, Chief Executive Officer of Buna, said: ‘’We are pleased to welcome RAKBANK as participant in Buna. With the onboarding of RAKBANK, we look forward to unlocking the opportunities in enhancing cross border payments in multiple Arab and international currencies in compliance with global standards and international best practices. This is a major step to realize our vision to empower economies and strengthen integration within the Arab world. At this occasion, I would also like to thank the Central Bank of UAE for its continuous support to Buna.”

This move comes as the first of many initiatives by the Bank, aimed at enhancing their international payments capabilities. Buna has rapidly grown its network to include over 84 participant banks.

RAKBANK reports net profit of AED 527.4mn in H1 2022

26/07/2022

Key Highlights Q2 / H1 2022

Strong profit growth driven by diversified balance sheet & lower cost of risk in a buoyant macro-economic environment.

Net profit for the quarter at 307.3 mn up 39.7% compared to Q1 2022, reflecting the highest quarterly Net Profit since 2015.
Compared to Q1 2022, total Income increased by 12.1% to AED 815 mn during this quarter, supported by a strong increase of 4.2% on the Net Interest Income to AED 563.0 mn and an increase of 35.1% on the Non Interest Income to AED 252.0 mn.
Gross Loans & Advances at AED 35.8 bn, up 7.8% YoY and 4.7% year-to-date.
Customer Deposits at AED 39.6 bn, up 6.8% YoY and 5.1% year-to-date.
Balance sheet crosses the AED 60 bn milestone.
Well diversified asset growth and continued improvement in the macro-economic environment led to 58.0% YoY reduction in impairments.

Healthy returns whilst remaining well capitalized and having one of the best provision coverage ratios in the industry.

Net Interest Margins stable at 3.9%, continues to be one of the highest in the Industry.
Non-Performing Loans ratio at 3.6% continues to improve.
Loan Provision coverage ratio at 142.1% remains one of the strongest in the industry.
Solid returns with annualized ROA at 1.9% and annualized ROE at 12.7%.
With Capital Adequacy Ratio (CAR) at 16.8%, the Bank remains well capitalized.

RAKBANK CEO, Raheel Ahmed, commented:

“RAKBANK continued the momentum in Q1 to deliver a strong set of financial results in Q2, recording a net profit of AED 527 mn for H1 2022. Our return on equity is at 12.7% & we continue to maintain an industry leading provision coverage ratio of 142.1%.

We have seen broad based asset growth (7.8% YOY) across all segments of our business, as part of our diversification strategy. Similarly, we are equally pleased with strong deposit growth (6.8% YoY). We maintained our net interest margins at 3.9%, one of the highest in the industry.

Innovation is in our DNA. To support the UAE’s vision to become a global hub for digital assets, we have partnered with Kraken, a global crypto exchange licensed by ADGM, to soon enable their customers to trade directly between crypto & dirhams through local bank accounts. Similarly, as the “go to” bank for the budding entrepreneurs and the thriving SMEs we offered financing solutions to more than 2,400 small and medium enterprise customers in the last six months. This will not only enable them to launch or grow their businesses, but also contribute to the country’s economic growth. We also partnered with DIFC & a few other banks to launch the region's first Open Finance Lab to promote the development and growth of the UAE financial technology sector.

We continue to accelerate our focus on being trusted advisors to our customers and clients for all their financial needs enabled by digital solutions, personalization (through analytics) & a customer obsessed mind-set and culture. I am pleased to report that we crossed 5Mn digital transactions in H1 of 2022 (up 20% YoY). Customer engagement also continues to strengthen with 26% YoY spend growth on our cards & 6% YoY increase in payments by customers on RAKBANK rails.

In line with the buoyancy in the UAE economy, our outlook for H2 2022 remains positive. However, we continue to carefully monitor the rising interest rates, inflation & the current geopolitical tensions & its potential impact on our customers and clients & supporting them to manage their finances through these uncertain times.”

Financial Highlights for Q2 / H1 2022

Income Statement Highlights:

Income Statement Highlights	Quarter Results					Half Year Results
(AED Mn)	Q2’22	Q2’21	Q1’22	Q2’22 vs Q2’21	Q2’22 vs Q1’22	H1 ‘22	H1 `21	H1 `22 vs H1' 21
Net Interest Income and net income from Islamic financing	563.0	543.0	540.4	3.7%	4.2%	1,103.4	1,074.8	2.7%
Non-Interest Income	252.0	288.8	186.5	(12.7%)	35.1%	438.5	557.9	(21.4%)
Total Income	815.0	831.8	726.9	(2.0%)	12.1%	1,541.9	1,632.7	(5.6%)
Operating Expenditures	(367.7)	(343.1)	(372.4)	(7.2%)	1.3%	(740.1)	(673.1)	(9.9%)
Operating Profit Before Provisions for Impairment	447.3	488.7	354.6	(8.5%)	26.2%	801.9	959.6	(16.4%)
Provisions for Impairment	(140.0)	(296.6)	(134.5)	52.8%	(4.1%)	(274.5)	(653.6)	58.0%
Net Profit	307.3	192.1	220.1	60.0%	39.7%	527.4	306.0	72.4%

Balance Sheet Highlights:

Balance Sheet Highlights	Results as at				Variance
(AED Bn)	Jun’22	Mar'22	Dec'21	Jun'21	Jun'22 vs Dec'21	Jun'22 vs Jun'21	Jun'22 vs Mar'22
Total Assets	60.8	58.6	56.3	54.3	7.9%	11.9%	3.7%
Gross Loans & Advances	35.8	35.8	34.2	33.2	4.7%	7.8%	0.0%
Deposits	39.6	38.5	37.6	37.0	5.1%	6.8%	2.9%

Key Ratios:

Key Ratios	Quarter Ratios					Half Year Ratios
Percentage	Q2'22	Q2'21	Q1'22	Q2'22 vs Q2'21	Q2'22 vs Q2'22	H1'22	H1'21	H1'22 vs H1'21
Return on Equity	14.8%	9.8%	10.5%	5.0%	4.3%	12.7%	7.8%	4.9%
Return on Assets	2.1%	1.5%	1.6%	0.6%	0.6%	1.9%	1.2%	0.7%
Net Interest Margin	3.9%	4.2%	3.9%	(0.3%)	0.0%	3.9%	4.2%	(0.3%)
Cost to Income	45.1%	41.3%	51.2%	(3.8%)	6.1%	48.0%	41.2%	(6.8%)
Impaired Loan Ratio	3.6%	5.1%	3.7%	1.5%	0.1%	3.6%	5.1%	1.5%
Impaired Loan Coverage Ratio	142.1%	127.7%	137.8%	14.4%	4.3%	142.1%	127.7%	14.4%
Basel III Total Capital Adequacy Ratio	16.8%	17.8%	16.5%	(1.0%)	0.3%	16.8%	17.8%	(1.0%)

*Annualized
**After application of Prudential Filter

Key Highlights

Profitability Growth supported by Income momentum and improvement in Provisions

Balance Sheet crosses AED 60 Bn with a strong uptick across customer segments

Balance sheet crosses AED 60 bn as the Total Assets increased year to date by AED 4.5 bn reflecting a growth of 7.9%, due to an increase in Gross Loans and Advances by AED 1.6 bn, Cash and Central Bank balance increased by AED 1.3 bn, Lending to Banks which increased by AED 907 mn and Investments increased by 264 mn.
Lending in the Wholesale Banking increased by AED 754.0 mn, Retail Banking segment increased by AED 339.7 mn and Business Banking lending increased by AED 522.7 mn compared to 31 December 2021. Strong balance sheet momentum was visible across all the segments
Wholesale Banking Segment reflecting a strong YTD growth on the balance sheet of 8.7% on the back of over 20% growth in the Financial Institutions portfolio
Growth for Retail Banking supported by a strong sales momentum across products, with Auto loans reflecting 5.1% YTD growth, Mortgages growing by 3.7%, and Credit Cards by 1.2%.
Business Banking segment recorded a 6.5% growth YTD backed by 4.8% growth on Business Loans while trade and working capital loans reflected 8.9% growth YTD.
Total Assets increased by AED 6.5 bn to AED 60.8 bn compared to 30 June 2021 mainly due to an increase in Gross Loans and Advances AED 2.6 bn, AED 2.0 bn in Cash and Central bank balances, AED 846 mn in Investments and AED 475 mn in Due from other banks.
Non-performing Loans and Advances to Gross Loans and Advances ratio was 3.6% as at 30 June 2022 compared to 5.1% as at 30 June 2021 and 4.1% as at December 2021.

Strong Growth in Customer Deposits as we become the main bank for more of our customers

Customer deposits increased by 6.8% as against first half of 2021 and 5.1% or AED 1.9 bn to AED 39.6 bn compared to 31 December 2021 mainly due to increase of AED 1.3 bn in time deposits and AED 624.4 mn in CASA accounts endorsing the trust our customers place in the RAKBANK franchise and our services.

Capital and Liquidity

The Bank’s total Capital Ratio as per Basel III, after the application of prudential filter was 16.8% compared to 17.0% at the end of the previous year.
The regulatory eligible liquid asset ratio at the end of the first half was 13.0%, compared to 11.6% as at 31 December 2021, and advances to stable resources ratio stood comfortably at 82.0% compared to 82.9% at the end of 2021.

Cash Flows

Cash and cash equivalent as at 30 June 2022 were AED 4.3 bn compared to AED 2.8 bn as at 30 June 2021.
Net cash generated from operating activities was AED 2.9 bn, AED 720.2 mn was used in investing activities and AED 1.2 bn used in financing activities.

Impact of Projected Capital Expenditure and developments

The Group incurred AED 31.9 mn in capital expenditure primarily focused on implementing and embedding Consumer Protection Framework while enhancing our AML / CFT systems.
The Bank will continue to invest in innovative digital first technological solutions to offer a highly personalized & digitized experience for our customers.

Further embedding ESG into RAKBANK’s Strategy and Mission

Q2 2022 Major Events and Developments

RAKBANK is one of the four Banks to partner with DIFC to launch the region's first Open Finance Lab to promote the development and growth of the UAE financial technology sector.
RAKBANK revamped its Digital Market place for SMEs (SMEsouk) with added features and functionalities such as trade license comparator, business toolkit, Digital onboarding, and more.

Risk Management in the Current Economic Scenario

The ongoing geopolitical crisis in conjunction with the rising interest rates has and is expected to continue to exert an upward pressure on the prices of the most basic necessities.
Sharp rise in input costs, as prices for fuel, metals, chemicals etc. remain elevated impacted by the global supply-chain challenges
These factors are expected to prompt a greater caution and risk aversion as we tread cautiously into the second half of 2022.

Strategy Going Forward

RAKBANK is refreshing its 5-year strategy which defines the bank’s renewed purpose of ‘Simply Better’ banking by becoming the trusted advisor for its customers & clients for their financial needs.
We are making rapid process in further strengthening our SME customer experience through the launch of digital onboarding & loan capabilities & diversifying & enhancing our wholesale banking business into a relationship led model.

Rating Agency	Last Update	Deposits	Outlook
Moody’s	May 2022	Baa1 / P-2	Stable
Fitch	April 2022	BBB+ / F2	Stable
Capital Intelligence	August 2021	A- / A2	Stable

RAKBANK and Kraken to Offer UAE's First AED-Denominated Virtual Asset Trading

18/07/2022

RAKBANK will become the first UAE bank to enable Kraken to offer transparent, efficient, dirham-based digital asset trading to their customers, as the UAE takes strides to achieve its vision of becoming a global virtual asset hub.

Abu Dhabi, July 18, 2022 – In line with its commitment to “Simply Better” banking and innovation, RAKBANK and Kraken MENA (Kraken), one of the world’s largest digital asset exchanges, have today announced UAE residents will soon be able to trade virtual assets in AED using their local bank account. As regulated by the Central Bank of UAE, RAKBANK will enable Kraken, which is licensed by Abu Dhabi Global Market (ADGM), to have their UAE-based clients fund their crypto account through local fund transfers from any bank in the UAE. Kraken was the first global exchange to have received a full license to operate a regulated virtual asset exchange platform in the Abu Dhabi Global Market (ADGM).

Currently, UAE residents who trade virtual assets must use banks or foreign correspondents outside the UAE to fund their trading. As a result, they incur high foreign exchange costs and fees, experience long lead times (more than 24 hours) and are subject to overseas-jurisdiction asset governance. Through this innovative solution, UAE residents will be able to fund their account faster and at lesser costs, all while remaining within the UAE’s jurisdiction.

“We are proud to be the first UAE bank to enable Kraken, so that it can offer this solution to its UAE-resident crypto investors. This is another step towards our goal of making banking simpler and easier through innovation,” said Raheel Ahmed, Chief Executive Officer of RAKBANK. “The UAE is emerging as a global hub for the crypto and virtual assets industry. With this breakthrough solution, Kraken’s UAE-based investors will be able to transact in virtual assets transparently and efficiently through an ADGM-regulated crypto exchange that has the ability to convert between AED and crypto through UAE Central Bank-regulated banking channels.”

“We are pleased to support the UAE’s vision of becoming a global hub for virtual assets. We believe this offering will enable a simpler, faster and cheaper solution for UAE residents,” added Raheel.

“Kraken is one of the largest and most trusted virtual asset exchanges in the world,” said Benjamin Ampen, Managing Director for Kraken MENA. “Investors in the UAE will soon be able to directly participate and invest in the crypto market. Our solution is safer, more secure, more efficient and reduces costs. Alongside our partners at RAKBANK and under the pioneering regulatory oversight of the ADGM, we are about to make our vision of AED-denominated crypto trading in the UAE a reality.”

H.E Ahmed Jassim Al Zaabi, Chairman of Abu Dhabi Global Market (ADGM) said, "We congratulate RAKBANK and Kraken on this successful partnership that showcases the thriving virtual asset ecosystem of Abu Dhabi and the trust that financial institutions have in the ADGM’s regulatory framework. Today, as an International Financial Centre, we are the leading jurisdiction in the region for the regulation of virtual asset activities and we strongly believe that this partnership is a step forward that confirms Abu Dhabi’s role as a catalyst for virtual-asset innovation".

RAKBANK’s Net Profit jumps by over 93% in the First Quarter of 2022

26/04/2022

Q1 2022 net Profit up by AED 106.1 million (93.1%) compared to Q1 2021
Total Assets increased by AED 2.3 billion year-to-date
Gross Loans and Advances amounted to AED 35.8 billion as of 31st March 2022, an increase of 4.7% year-to-date
Customer Deposits increased by AED 811 million year-to-date

United Arab Emirates, 26 April, 2022: The National Bank of Ras Al-Khaimah (“RAKBANK”) has announced a consolidated Net Profit of AED 220.1 million for Q1 2022, an increase of 93.1% compared to the first quarter of 2021. Total Income of AED 726.9 million, decreased by 8.3% compared to the fourth quarter of 2021. As at 31 March 2022, Total Assets stood at AED 58.6 billion, increasing by 10.1% year-on-year and 4.1% year-to-date.

RAKBANK CEO, Raheel Ahmed, commented:

“Our diversification strategy is working well. Q1 2022 net profit at AED 220.1 million is 93.1% higher compared to Q1 2021. We have delivered this very significant increase in net profit by improving our return on equity by 460 basis points to 10.5%, improving our returns on assets to 1.6%, whilst maintaining one of the highest impaired loan coverage ratio in the industry at 138%. We saw a reduction in our non-interest income driven by lower trading forex & derivatives & Investment Incomes. However, we expect that this will not be repeated in subsequent quarters. We have a strong balance sheet momentum across all lines of businesses as is evident from the 9.3% year-on-year growth in gross loans and advances. We have seen over a 20% year-on-year increase in digital engagement with customers & have seen double digit growth in both customer spends & customer payments versus Q1 2021. Continuing our journey of innovation, we launched Digital Lending for SMEs & further enhanced our SMEsouk portal - www.smesouk.com - the one stop digital platform for businesses in the UAE.”

Q1 2022 highlights

Net Profit increased by AED 106.1 million compared to Q1 2021
Net Interest Income increased by AED 8.7 million compared to Q1 2021
Total Assets increased by 10.1% compared to Q1 2021
Annualised Return on Assets stood at 1.6% and Return on Average Equity at 10.5%

Performance review

Total Assets increased year-to-date by AED 2.3 billion which translates into a growth of 4.1%, due to an increase in Gross Loans and Advances which increased by AED 1.6 billion, Lending to Banks which increased by AED 751 million, offset by a reduction in Cash and Central Bank balances by AED 128 million. Total Assets increased by AED 5.4 billion to AED 58.6 billion compared to 31 March 2021 mainly due to an increase of AED 3.1 billion in Gross Loans and Advances, AED 1.3 billion Due from Banks and AED 850 million in Investments.

Provision for Credit Loss decreased by AED 222.5 million compared to Q1 2021 and by AED 63.2 million compared to Q4 2021. Non-Performing Loans and Advances to Gross Loans and Advances ratio was 3.7% as at 31 March 2022, Net Credit Losses to average Loans and Advances ratio closed at 1.6% compared to 4.5% as at the end of the first quarter of 2021.

On a year-on-year basis, Total Operating Income declined by AED 74.0 million to AED 726.9 million. The Net Interest Income and Net Income from Shariah-Compliant Islamic Financing increased by 1.6% year-on-year largely due to the increase in assets. However, the Non-Interest Income decreased by AED 82.7 million to AED 186.5 million, mainly due to a year-on-year decrease in FOREX and Derivative Income of AED 40.8 million, AED 29.3 million in Investment Income and AED 13.6 million in Other Operating Income. This was partly offset by an increase of AED 2.1 million in Net Insurance Underwriting Profit. The reduction was largely due to one off trading losses in the proprietary book due to a sudden increase in interest rates in Quarter 1 impacting the bond book and certain derivative positions. This was further exacerbated by devaluation in foreign exchange rates in certain currencies due to macroeconomic and geopolitical reasons.

The Bank’s total Capital Ratio as per Basel III, after the application of the prudential filter was 16.5% compared to 17.0% at the end of the previous year. The regulatory eligible Liquid Asset Ratio at the end of the quarter was 11.9%, compared to 11.6% as at 31 December 2021, and Advances to Stable Resources ratio stood comfortably at 87.0% compared to 82.9% at the end of 2021.

Q2 2022 outlook

“The impact of rising interest environment, Russia & Ukraine conflict & increase in inflation will have to be managed carefully. There is also intense competition for talent globally. However the UAE economy continues to grow strongly & there has been a significant improvement in both business & consumer sentiment. At RAKBANK we will continue to rapidly accelerate our focus on delivering personalized & convenient financials solutions for our clients whilst providing brilliant customer experience at all touch points.” said Raheel Ahmed. “We strongly believe that whilst continuing to build secure digital solutions is critical, so is ensuring that our colleagues are always there to support our customers, when needed. We are investing in both to deliver ‘Simply Better’ banking.”

Financial Highlights

Increase in Net Profit by over 93%

Income Statement Highlights

	Quarter Results			Variance
(AED Mn)	Q1’22	Q4’21	Q1’21	FY ‘21	FY `20
Net Interest Income and net income from Islamic financing	540.4	547.2	531.7	(1.2%)	1.6%
Non-Interest Income	186.5	245.3	269.2	(24.0%)	(30.7%)
Total Income	726.9	792.4	800.9	(8.3%)	(9.2%)
Operating Expenditures	(372.4)	(371.1)	(330.0)	(0.3%)	(12.9%)
Operating Profit Before Provisions for Impairment	354.6	421.3	470.9	(15.8%)	(24.7%)
Provisions for Impairment	(134.5)	(197.7)	(354.0)	32.0%	62.3%
Net Profit	220.1	223.6	113.9	(1.6%)	93.1%

Double Digit Increase in Total Assets

	Results as at			Variance
(AED Bn)	Mar’22	Dec'21	Mar'21	Mar'22 vs Dec'21	Mar'22 vs Mar'21
Total Assets	58.6	56.3	53.2	4.1%	10.1%
Gross Loans & Advances	35.8	34.2	32.7	4.7%	9.3%
Deposits	38.5	37.6	36.5	2.2%	5.4%

Marked improvement in Return on Equity & Return on Assets

	Results			Variance
Percentage	Mar’21	Dec'21	Mar'21	Mar'22 vs Dec'21	Mar'22 vs Mar'21
Return on Equity	10.5%	9.5%	5.9%	1.0%	4.6%
Return on Assets	1.6%	1.4%	0.9%	0.2%	0.7%
Net Interest Margin	3.9%	4.1%	4.2%	(0.2%)	(0.3%)
Cost to Income	51.22%	43.2%	41.2%	(8.0%)	(10.0%)
Impaired Loan Ratio	3.7%	4.1%	5.4%	0.4%	1.7%
Impaired Loan Coverage Ratio	137.8%	133.7%	125.7%	4.1%	12.1%
Basel III Total Capital Adequacy Ratio	16.5%	17.0%	18.1%	(0.5%)	(1.6%)

*Annualized
**After application of Prudential Filter

Lending in Wholesale Banking increased by AED 1.3 billion, Retail Banking segment increased by AED 104 million and Business Banking lending increased by AED 238 million compared to 31 December 2021.

Customer deposits increased by AED 811 million to AED 38.5 billion compared to 31 December 2021 mainly due to increase of AED 322 million in time deposits and AED 489 million in CASA accounts.

RAKBANK gets continuously rated by leading rating agencies with their latest ratings shown clearly in the table below. Fitch Ratings recently rated RAKBANK at 'BBB+', with a stable outlook. This rating reflects the institutional strength of the Bank that is backed up by trust and transparency in financial reporting.

Rating Agency	Last Update	Deposits	Outlook
Moody’s	October 2021	Baa1 / P-2	Stable
Fitch	April 2022	BBB+ / F2	Stable
Capital Intelligence	August 2021	A- / A2	Stable

RAKBANK’s Environmental, Social and Governance (ESG) framework is currently rated as BBB by Morgan Stanley Capital International (MSCI).

Furthermore, RAKBANK believes that long-term financial growth requires a thorough integration of sustainability with its core business strategy. We intend to consistently improve Environmental, Social and Governance (ESG) practices throughout RAKBANK’s operations. The Bank’s Environmental, Social and Governance (ESG) framework is currently rated as BBB by Morgan Stanley Capital International (MSCI). For more details on the Bank’s ESG Framework and Approach the Bank urges the public to read the RAKBANK 2021 Annual Integrated Report.

RAKBANK launches UAEs first Digital Onboarding Platform for SME Loans

04/04/2022

United Arab Emirates, 04 April 2022 – RAKBANK announces the launch of a “first of its kind” digital onboarding experience in the region which will enable SMEs to apply for Business Loans, Term and Working Capital Finance and Asset based finance through the RAKBANK Quick Apply portal: quickapply.rakbank.ae/business/finances.

SME customers can now not only apply for Business Accounts but also Business Finance products in just a few minutes and get instant in-principal approval followed by the funds disbursal in just a few days, without having to visit a branch or sales office.

This initiative is in line with the Bank’s strategy to improve its customer experience through simple and convenient digital solutions and follows the recent enhancement of its SMEsouk platform which is a one-stop digital marketplace for all SMEs.

Through the SMEsouk platform – www.smesouk.com, existing and budding entrepreneurs can set up their business from getting a trade license to opening a bank account with easy toolkits, grow it further with curated partnerships and exclusive offers and expand their community through events, webinars and a marketplace to list their products and services.

Raheel Ahmed, CEO at RAKBANK commented: “At RAKBANK, we understand that SMEs are the true heart of every growing economy. That's why we are building a digital ecosystem where SMEs can connect to setup, grow their business and expand their community in a seamless and quick way. The digital onboarding for business loans and finance along with the SMEsouk initiative reaffirms the Bank’s commitment to the SME community and bolsters our efforts to become an integrated, technology-enabled, and customer-centric financial services provider”.

RAKBANK and Tradeling Announce a Strategic Partnership to Support the Growth of SMEs in UAE

22/02/2022

United Arab Emirates, 22 February 2022 – The National Bank of Ras Al Khaimah (RAKBANK) signed a Memorandum of Understanding (MoU) with Tradeling, the hyper growing e-marketplace focused on business-to-business (B2B) transactions in the Middle East and North Africa. The MoU aims at providing enhanced value offering to RAKBANK Business Cardholders.

The partnership with Tradeling offers RAKBANK and RAKislamic Business cardholders access to preferential buying terms across all categories on their website, Tradeling.com. It results in a smooth process for the Bank’s SME customers whereby they can streamline their procurement process, maximize their earning potential, benefit from competitive prices, and free domestic shipping within the UAE for one Year.

Tradeling’s platform further leverages advanced technology to optimize the supply chain processes, creates economic value as well as mitigates risks for small businesses. It is in line with RAKBANK’s strategy of building the necessary ecosystem and infrastructure for SMEs to develop sustainably. The MoU provides RAKBANK SMEs instant access to an online marketplace and platform that directly supports their goals and objectives of growing their business locally, regionally, and internationally.

Commenting on the partnership Marius Ciavola, CEO of Tradeling, said: “Our long term partnership with RAKBANK will expedite the growth of SMEs in UAE through various trade finance solutions that offers easy payment options and discount rates designed specifically to tackle the hurdles faced by B2B buyers and sellers.”

He added: “We are constantly working on offering the best and most profitable solutions for our customers to further expand their reach by connecting sellers and buyers from different parts of the world and enabling them to continue operating in a seamless and efficient manner, all while utilizing the financial benefits available on our platform.”

For his part, Dhiraj Kunwar, Managing Director of Business Banking at RAKBANK, said: “This partnership is in line with our strategy of providing Digital services and platform lending to SMEs. Through this partnership, our customers will be able to unlock valuable opportunities to connect to B2B sellers and buyers from around the world. E-commerce has become a significant growth tool for any business in today’s climate, and Tradeling’s platform offers SMEs an ideal gateway to a wider customer base across the region to gain broader recognition for their products and services”.

Tradeling has recorded impressive growth in the last two years. Led by a team of experienced technology startup builders, Tradeling ensures a reliable and smooth trade process in addition to providing logistics and financing solutions. Connecting global suppliers with MENA-based demand, the platform leverages advanced technology to optimise the supply chain and creates economic value in addition to mitigating risks. Today, Tradeling has over 100,000 registered buyers and sellers from over 55 countries.

RAKBANK Reports Net Profit of AED 758.3 million for 2021

01/02/2022

RAKBANK’s Full-Year 2021 Net Profit increased by AED 252.9 million, a 50% increase over 2020
The Bank’s Total Assets increased by 6.7% to AED 56.3 billion during 2021
Gross Loans and Advances amounted to AED 34.2 billion as of 31st December 2021, a year-on-year increase of 6.1%
The Bank’s Non-Interest Income grew by 2.3% year-on-year

United Arab Emirates, 01 February, 2022: The National Bank of Ras Al-Khaimah (“RAKBANK”) announced a consolidated Net Profit of AED 758.3 million for the Full-Year 2021, resulting in an increase of AED 252.9 million when compared to the previous year. The Bank’s Total Assets amounted to AED 56.3 billion, increasing by 6.7% over 2020. In addition, the Gross Loans and Advances closed at AED 34.2 billion, a year-on-year hike of 6.1%.
Similarly, Customer Deposits grew by 1.9% and this is due to the growth in Time Deposits by 7.4% compared to the previous year, amounting to AED 660.1 million. Similarly, the Return on Average Assets Ratio closed the year at 1.4% compared to 0.9% for the previous year and Return on Average Equity was 9.5%, compared to 6.5% in 2020.
The Board of Directors recommended distribution of a cash dividend of 22.5 fils per share for the shareholders’ consideration and approval at the Annual General Meeting (AGM).

RAKBANK CEO, Peter England, commented: “RAKBANK had a strong finish to 2021, driving Net Profit for the year up to AED 758.3 million. We continue to transform our Bank with a focus on simplification, digitalization and building a culture of excellence. Throughout these past years, we have seen that RAKBANK’s resilience and nimbleness enabled us to offer sound support to our customers throughout the pandemic, with the help of the country’s regulators. Income growth has been a challenge in 2021 as a result of very little business activity during 2020. However, we saw this gradually turn around as the year progressed and the business momentum in the second half of 2021 reflected positively on the Bank’s performance. On Asset Quality, we have seen a significant improvement and our Provisions for 2021 are the lowest they have been in the last 6 years, indicating a strong rebound in the economy and the success of our business diversification strategy that we commenced in 2015.”

FY 2021 highlights

Net Profit is up 50.0% compared to the previous year.
Year-on-year increase in the Annualized Return on Assets amounting to 1.4% and Return on Equity to 9.5% respectively for the full year 2021.
Non-performing Loans and Advances to Gross Loans and Advances Ratio improved to 4.1% as at 31 December 2021.
Provision Charges for Credit Loss decreased by 35.3% year-on-year.

Performance review

Total Income for the financial year ended 31 December 2021 amounted to AED 3.2 billion, which decreased by 9.4% as compared to the same period of the previous year. Net Interest Income and Net Income from Islamic Finance stood at AED 2.2 billion for the year 2021, decreasing by 14.1% year-on-year. Non-Interest Income increased by AED 23.7 million year-on-year to AED 1.1 billion, mainly due to an increase of AED 54.1 million in Net Fees and Commission Income. Operating Expenses remained the same year-on-year and the Cost to Income Ratio closed at 43.2% for the year.

Gross Loans & Advances increased by AED 2.0 billion to AED 34.2 billion, which is a rise of 6.1% year-on-year resulting in an increase in the Bank’s Total Assets by 6.7% to AED 56.3 billion compared to 31 December 2020. Whereas, Customer Deposits grew by AED 702.8 million to AED 37.6 billion, a 1.9% increase compared to 31 December 2020.

Asset quality
Provision Charges for Credit Loss decreased by AED 586.6 million (FY 2021 Vs FY 2020), which is a 35.3% decrease year-on-year. The Non-Performing Loans and Advances to Gross Loans and Advances Ratio closed at 4.1% for the Full-Year 2021 compared to 5.2% as at 31 December 2020. RAKBANK is well provisioned against Loan Losses with a Loan Loss Coverage Ratio of 133.7%, excluding mortgaged properties and other realizable asset collateral available against loans.

Capitalization and liquidity
The Bank’s Total Capital Adequacy Ratio as per the Central Bank of the UAE regulations and as per Basel III stood at 17.0% at the end of December 2021. The Common Equity Tier 1 ratio of the Bank stood at 15.9%. The Loans to Stable Resources Ratio LSRR as at 31 December 2021, stood at 82.9% compared to 80.7% at the end of 2020, which is significantly lower than the maximum limit of 110%. The regulatory eligible Liquid Asset Ratio of the Group stood at 11.6% at the end of December 2021 compared to 14.5% at the end of 2020, which is well above the minimum requirement and reflects a healthy liquidity position.

RAKBANK’s Chairman, H.E. Mohamed Omran Alshamsi, commented: “RAKBANK’s financial performance this past year yielded tangible results despite the operating environment of 2021. Looking back, during the first half of the year, the UAE economy was recovering from the impacts of COVID-19. However, the second half resulted in a complete turnaround, and this applied to RAKBANK as well. Just as the UAE economy continued to swiftly rebound, RAKBANK has demonstrated a similar form of resilience in 2021 underpinned by the Bank’s diversification strategy. It has become evident that we are well positioned for strong and sustainable growth in the years ahead. Our core business is primed to continue its steady growth on the back of rising Retail and SME activities. Additionally, throughout this past year, RAKBANK focused on investments specifically in digitising the customer journey as we believe that it will drive efficiency and unlock access to attractive new segments. Lastly, I would like to announce that as of February 2nd 2022, Mr Raheel Ahmed will officially assume his responsibilities as the Chief Executive Officer of RAKBANK, as his designated handover period is now complete.”

Financial highlights

Income statement highlights

	Quarter Results			Full Year Results
(AED Mn)	Q4’21	Q4’20	Variance%	FY ‘21	FY `20	Variance%
Net Interest Income and net income from Islamic financing	547.2	561.8	(2.6%)	2,168.4	2,525.6	(14.1%)
Non-Interest Income	245.3	245.8	(0.2%)	1,062.1	1,038.4	2.3%
Total Income	792.4	807.6	(1.9%)	3,230.5	3,564.0	(9.4%)
Operating Expenditures	(371.1)	(363.7)	(2.0%)	(1,395.6)	(1,395.3)	0.0%
Operating Profit Before Provisions for Impairment	421.3	443.9	(5.1%)	1,835.0	2,168.7	(15.4%)
Provisions for Impairment	(197.7)	(377.1)	47.6%	(1,076.7)	(1,663.3)	35.3%
Net Profit	223.6	66.7	235.1%	758.3	505.4	50.0%

Balance sheet highlights

	Results as at			Variance
(AED Bn)	Dec’21	Sep’21	Dec’20	Quarter-on-Quarter	Year-on-Year
Total Assets	56.3	54.5	52.8	3.3%	6.7%
Gross Loans & Advances	34.2	33.5	32.2	2.1%	6.1%
Deposits	37.6	37.0	36.9	1.8%	1.9%

Key ratios highlights

	Results			Variance
Percentage	Dec’21	Sep’21	Dec’20	Quarter- on -Quarter	Year-on-Year
Return on Equity	9.5%	9.0%	6.5%	0.5%	3.0%
Return on Assets	1.4%	1.4%	0.9%	0.0%	0.5%
Net Interest Margin	4.1%	4.1%	4.6%	0.0%	(0.5%)
Cost to Income	43.2%	42.0%	39.2%	(1.2%)	(4.0%)
Impaired Loan Ratio	4.1%	4.5%	5.2%	0.4%	1.1%
Impaired Loan Coverage Ratio	133.7%	134.3%	129.4%	(0.6%)	4.3%
Basel III Total Capital Adequacy Ratio	17.0%	17.8%	18.6%	(0.8%)	(1.6%)

The Wholesale Banking and Financial Institutions lending was up by AED 1.5 billion compared to 2020 and Personal Banking’s Loan Portfolio also increased by AED 709.9 million. However, the Business Banking Loan Portfolio declined by AED 262.3 million compared to the previous year.

RAKBANK is currently rated by the following leading rating agencies, with their ratings provided below:

Rating Agency	Last Update	Deposits	Outlook
Moody’s	October 2021	Baa1 / P-2	Stable
Fitch	December 2021	BBB+ / F2	Stable
Capital Intelligence	August 2021	A- / A2	Stable

RAKBANK’s Environmental, Social and Governance (ESG) framework is currently rated as BBB by Morgan Stanley Capital International (MSCI).

RAKBANK Announces New Chief Executive Officer

16/12/2021

United Arab Emirates, 16 December 2021: The National Bank of Ras Al Khaimah’s (RAKBANK) Board of Directors appointed Mr. Raheel Ahmed as the new Chief Executive Officer. He will join RAKBANK on 3rd of January 2022 and will take over as CEO during the first quarter of 2022, after the designated handover period is completed. Raheel succeeds Peter England, who will retire to Australia after successfully leading the Bank for over 8 years.

Raheel is a seasoned banker & transformational leader with over 30 years of banking experience across Europe, Asia, Middle East & Africa. He has held senior executive positions at Standard Chartered, Citigroup and Barclays. He has also served as a board member of companies at Standard Chartered and Barclays.

Raheel joins RAKBANK from Barclays UK where he was member of the Executive Committee & the Chief product & analytics officer, responsible for the strategy & commercial performance of the personal banking products. He was also the executive sponsor of Diversity & Inclusion for Barclays UK, a topic that he is passionate about. During his time at Barclays Raheel led the Digital & Analytics transformation to create personalized and frictionless products and services for over 20M customers. He built and led on strategic partnerships with Big Tech & Fin Tech firms & contributed significantly to the automation & digitalization of Barclays UK.

Raheel is no stranger to the UAE, prior to joining Barclays he was based in Dubai with Standard Chartered Bank as the Regional Head of Consumer Banking for Middle East & Africa.

As the Bank’s new CEO, Raheel aims to accelerate the achievement of RAKBANK’s vision by developing & executing strategies that enable the Bank to grow profitability & win market share in an environment where customer expectations is rapidly changing; whilst aspiring to be best in class in customer engagement.

“Raheel is an accomplished leader and we are more than delighted that he will be joining the Bank. He is a versatile and experienced banker who joined us from Barclays bank in the UK where he was the Chief Product and Analytics Officer, responsible for the strategy and commercial performance of the Personal Banking and Barclaycard businesses.” Said H.E. Mohamed Omran Alshamsi, Chairman of RAKBANK. “Raheel is strategic, yet detail oriented; and has the ability to lead high-performing teams. We are confident that he will help further strengthen our Bank and grow its presence in the UAE and specifically in Ras Al Khaimah. I would also like to take this opportunity to thank Peter England for leading RAKBANK for over eight years. During that time and under his leadership, the Bank has significantly grown and flourished. Peter’s contribution to the sustained profitability, diversified revenue streams and sound corporate governance is highly commendable. I wish him the very best in his future endeavors.”

“It is my privilege & honor to have been chosen by the Board to lead RAKBANK for the next phase of its growth and transformation said the new CEO of RAKBANK, Raheel Ahmed. “RAKBANK is known for its innovation & customer focus. I am excited by the opportunities in front of us to support the customers & businesses that we serve even more impactfully. A big part of my job will be to enable our team to bring innovative products & services to the market at speed thereby further strengthening our position in the UAE & in Ras Al Khaimah. We will aim to do so by providing ‘Simply Better’ products and services by leveraging the combined power of our brilliant colleagues, digital technology & advanced analytics whilst embracing the highest standards of corporate governance.”

RAKBANK Signs a Memorandum of Understanding with Jebel Ali Free Zone to facilitate banking services for Jafza companies

12/12/2021

Jafza collaboration with RAKBANK will provide free zone companies with access to instant banking solutions through a dedicated digital portal

The National Bank of Ras Al Khaimah (RAKBANK) signed a Memorandum of Understanding (MoU) to form a Strategic Alliance with Jebel Ali Free Zone (Jafza), the leading trade and logistics hub of the UAE. This partnership aligns with both the organizations’ strategy of supporting SMEs and further developing a sustainable economy.

As part of the agreement, RAKBANK will offer SMEs that operate in Jafza instant access to the Bank’s solutions and services. Among the products offered to SMEs in the free zone are the RAKstarter account, Business Current Account, and priority service banking with the RAKelite Business. As for financing, the Bank will offer Business loans, Point of Sale financing, Term and Working Capital financing, Real Estate financing, Asset-based financing, and Cash Management services.

Jafza is the largest free zone in the region for trade and logistics and home to a dynamic base of entrepreneurs and large corporates which benefit from Jebel Ali’s unrivalled logistics infrastructure and services. The cooperation with RAKBANK and Jafza further enhances Jafza’s integrated ecosystem for companies to establish and grow their activities with all the support required delivered directly to them through the digital channels. SMEs in Jafza will also benefit from RAKBANK's deep understanding of SME requirements and sophisticated data analytics to support SME’s banking needs.

The MoU will facilitate businesses in Jafza to enjoy a 100% digital and fast account opening process with RAKBANK and have access to additional essential banking services.

Commenting on the partnership, Ahmad Al Haddad, Chief Operating Officer – Parks and Zones, DP World UAE, said: “Our partnership with RAKBANK comes at a crucial time where SME formation is at an all-time high. The UAE economy is on a strong growth trajectory, as evidenced by key economic indicators. At the same time, Jafza witnessed robust new customer growth of nearly 40 per cent year-on-year in H1 2021. This collaboration will benefit our diverse customer base of nearly 9,000 customers who can seamlessly access RAKBANK’s services. The agreement will also increase Dubai’s competitiveness by addressing a key pain point that global businesses have highlighted.”

For his part, Dhiraj Kunwar, Managing Director of Business Banking at RAKBANK, commented: “The collaboration with Jafza is a natural next step in how RAKBANK seeks to enhance its collaboration with the prestigious free zone. We aim to constantly provide SMEs with the financial solutions and digital services they need. This signing reaffirms the Bank’s commitment to offering SMEs simple and convenient banking as they are the backbone of the UAE economy”.

The MOU comes at a time when the UAE economy is accelerating growth as the world recovers from the impacts of the pandemic. The agreement was signed by Ahmad Al Haddad, Chief Operating Officer – Parks and Zones, DP World UAE and Dhiraj Kunwar, Managing Director of Business Banking at RAKBANK.

RAKINSURANCE re-opens its branch in Ras Al Khaimah

31/10/2021

Ras Al Khaimah National Insurance Company (RAKINSURANCE), a subsidiary of RAKBANK, is pleased to announce the re-opening of its branch located in the heart of Ras Al Khaimah, Al Nakheel. The location is a suburban district in Ras Al Khaimah that is easily accessible by car or public transportation. The branch working hours are between 8:00AM and 4:30PM (Sunday to Thursday).

RAKINSURANCE branches are situated across the UAE in prime locations and cater to over 740,000 customers with protection that spans medical, motor and life insurance. Additionally, the Company also provides the required insurance services to a portfolio of more than 43,000 of its Corporate and Retail clients. It has a strong presence in the Emirate of Ras Al Khaimah, with branches operating in Dubai and Abu Dhabi.

“RAKINSURANCE is always striving to cater to customers across all the main locations in the UAE especially ones with heavy footfall. The reopening of our Nakheel branch is in line with the company’s commitment and continuous effort to improve our customer experience by delivering solutions that align with their needs and maximizing the value they get from our products and services.” said Ewen J. McRobbie, CEO RAKINSURANCE.

From his part, Peter England, CEO of RAKBANK commented: “The group’s strategy is to constantly offer a combination of both convenient locations in the UAE and outstanding digital experiences that deliver a cohesive journey for the customer. The opening of the RAKINSURANCE branch in the heart of our Home Emirate is in line with the Group’s plan to expand its network and to explore and develop major Corporate and Individual relationships in Ras Al Khaimah and the UAE.”

The re-opening goes hand in hand with the company’s “Simply Better” approach to address the growing demand for retail insurance solutions and to assure an outstanding customer service.

RAKBANK Reports Net Profit of AED 534.7 million for Nine Months Ended 30 September 2021

27/10/2021

Net Profit surged by 73.2% compared to the third quarter of 2020; up by 21.9% year-to-date
Gross loans and advances up by 2.7% to AED 33.5 billion compared with the third quarter of 2020; up by 4.0% year-to-date
Total deposits stood at AED 37.0 billion, up by 8.1% year-on-year
Non-interest income up by AED 24.1 million compared to same period last year
Provisions for the nine months of 2021 dropped by 31.7% year-on-year

United Arab Emirates, 26 October 2021: The National Bank of Ras Al-Khaimah (“RAKBANK”) announced a consolidated Net Profit of AED 534.7 million for the nine-month period ended 30 September 2021, compared to the net profit of AED 438.6 million for the same period last year. The Total Assets equated to AED 54.5 billion as at 30 September 2021, increasing by 4.1% year-on-year and by 3.3% year-to-date.

There are several factors that led to the spike in the Net Profit throughout the year, which include a reduction in the Provisions for Credit Loss along with an increase in Non-Interest Income to AED 258.9 million on the back of a growth in the Net Fee and Commission Income by AED 14.0 million as well as an increase in Other Operating Income by AED 17.5 million.

RAKBANK CEO, Peter England, commented: “We have seen a continual improvement in asset quality at RAKBANK especially in the last 2 quarters, which has led to a significant improvement in profitability. We have already surpassed our full year 2020 profit numbers in the first 3 quarters of this year. The improvement in asset quality has come about due to the change of mix in our loan book, which we have been gradually implementing over the last few years, and also the significant improvement in the macro-economic environment due to the exemplary handling of the COVID-19 pandemic by the Leadership of the UAE. We see these very positive trends continuing into the 4th quarter which will bode well for a strong start to 2022.”

Performance review YTD 2021
Total Income decreased by 11.5% to AED 2,438.1 million, compared to the same period last year, mainly due to a decrease in Net Interest Income and Net Income from Islamic financing by AED 342.5 million on account of the lower mix of high yielding assets. This was partially offset by higher Non-Interest Income of AED 24.1 million.

Net Interest Income and Net Income from Shariah-Compliant Islamic financing weakened by 17.4% year-on-year to AED 1,621.3 million and the Non-Interest Income increased by 3.0% to AED 816.8 million, as a result of the year-on-year increase of AED 34.0 million in Net Fees and Commission Income, AED 14.0 million in Investment Income and AED 19.2 million in Other Operating Income. This was partially offset by lower Forex and Derivative Income by AED 32.0 million and lower Gross Insurance Underwriting Profit by AED 11.1 million.

Asset
Total Assets increased by AED 1.7 billion or 3.3% year to date and by AED 2.2 billion year-on-year mainly due to the increase in Investment Securities by AED 2.1 billion and in gross Customer Loans & Advances increased by AED 884.4 million.

Asset quality
Provisions for Credit Loss decreased by AED 407.2 million year-on-year. The Non-Performing Loans and Advances to Gross Loans and Advances ratio closed at 4.5% compared to 5.2% as at 31 December 2020. Additionally, the annualised Net Credit Losses to Average Loans and Advances ratio closed at 3.6% compared to 4.9% year-to-date through September 2020.

Capitalization and liquidity
The Bank’s Capital Adequacy ratio as per Basel III was 17.8% compared to 18.6% as at the end of the previous year. The Common Equity Tier 1 ratio of the Bank stood at 16.7%. The regulatory eligible Liquid Asset ratio was 10.4% as at the end of September 2021. The Advances to Stable Resources ratio stood comfortably at 83.9%.

“RAKBANK continues to focus very heavily on its digital transformation and we are increasingly focused on delivering simpler and more convenient banking solutions. We are seeing great traction on our ‘Skiply’ app, which is now being used by over 100,000 families in the UAE access 180 educational institutions who don’t even need to be a RAKBANK customer to benefit from the proposition.” said Peter England. “We have also seen great success in our partnership with YAP that has developed a unique app based banking solution that allows new customers to open and operate RAKBANK accounts and benefit from a range of products and services provided by YAP and RAKBANK. This focus on digitalisation, innovation and partnerships will continue to grow and develop strongly in 2022 and beyond.”

Financial highlights

Income statement highlights

(AED Mn)	Q3’21	Q2’21	Q3’20	YTD’21	YTD’20
Net Interest Income and net income from Islamic financing	546.5	543.0	601.1	1,621.3	1,963.7
Non-Interest Income	258.9	288.8	251.4	816.8	792.7
Total Income	805.4	831.8	852.5	2,438.1	2,756.4
Operating Expenditures	(351.4)	(343.1)	(325.7)	(1,024.5)	(1,031.6)
Operating Profit Before Provisions for Impairment	454.0	488.7	526.8	1,413.6	1,724.8
Provisions for Impairment	(225.3)	(296.6)	(394.8)	(878.9)	(1,286.2)
Net Profit	228.7	192.1	132.0	534.7	438.6

Balance sheet highlights

(AED Bn)	Sep’21	Jun’21	Dec’20	Sep’20
Total Assets	54.5	54.3	52.8	52.3
Gross Loans & Advances	33.5	33.2	32.2	32.6
Deposits	37.0	37.0	36.9	34.2

Key ratios highlights

Percentage	Sep’21	Jun’21	Dec’20	Sep’20
Return on Equity	9.0%*	7.8%*	6.5%	7.6%*
Return on Assets	1.4%*	1.2%*	0.9%	1.1%*
Net Interest Margin	4.1%*	4.2%*	4.6%	4.7%*
Cost to Income	42.0%	41.2%	39.2%	37.4%
Impaired Loan Ratio	4.5%	5.1%	5.2%	5.1%
Impaired Loan Coverage Ratio	134.3%	127.7%	129.4%	131.2%
Total Capital Adequacy Ratio Basel III **	17.8%	17.8%	18.6%	19.4%

*Annualised
**After application of Prudential Filter

Total Assets increased by AED 1.7 billion to AED 54.5 billion compared to 31 December 2020, mainly due to an increase in Gross Loans and Advances by AED 1.3 billion, Investments by AED 1.7 billion and Due from Banks by AED 1.3 billion offset by a reduction in Cash and Balances from Central Bank of the UAE by AED 2.2 billion. The increase in Loans and Advances compared to 31 December 2020 is due to an increase of AED 568.6 million in Wholesale Banking loans, increase of AED 940.9 million in Retail Banking loans offset by a reduction of AED 234.6 million in Business Banking loans.

Customer Deposits increased by AED 43.5 million to AED 37.0 billion compared to 31 December 2020, mainly due to an increase in Time Deposits of AED 1,026.5 million. This was partly offset by a decrease of AED 982.9 million in CASA accounts.

RAKBANK is currently rated by the following leading rating agencies, with their ratings provided below:

Rating Agency	Last Update	Deposits	Outlook
Moody’s	July 2021	Baa1 / P-2	Negative
Fitch	May 2021	BBB+ / F2	Stable
Capital Intelligence	August 2021	A- / A2	Stable

RAKBANK’s Environmental, Social and Governance (ESG) framework is currently rated as BBB by Morgan Stanley Capital International (MSCI).

RAKBANK Launches firefly – a first of its kind companion app

06/10/2021

RAKBANK today announced that it has partnered with Mastercard, a leading technology company in the global payments industry to launch firefly – a first of its kind companion app for the RAKBANK Emirates Skywards World Elite Mastercard Credit Card.

With the firefly app, customers will never miss out on what matters to them. The app brings customers bespoke experiences and real time offers that best suit their interests and lifestyle at home and abroad so they can make the most of their card benefits.

Customers can enjoy the seamless experience offered by the app right from the simplified on-boarding process using the card scanner within the app. Built on a custom-developed recommendation engine, the app offers a fully personalized experience based on user preferences and behaviour. The content is then curated & tailored to customers’ interests contextual to their location through relevant messages thereby enriching their experience at home or while they travel.

“Never have the fear of missing out with the firefly app,” said Banali Malhotra, Director – Marketing, RAKBANK. “Thanks to firefly, not only will customers have all their Card benefits under their fingertips but also they will be able to access discounts of 50% and above over 5000+ offers across categories like Food, Health & Wellness, Travel & Entertainment, Shopping, Services, Jewellery & Watches and more. They can explore what is trending within the app and search and save great deals by their location. It is a true companion app for the discerning traveller.”

“Over the years, the Bank managed to transform the concept of credit card programs in the UAE through a host of unique features and now we are offering firefly - an ingenious API integrated Smart App to our cardholders,” said Peter England, RAKBANK CEO. “Staying true to the Bank’s prominent position as an innovative and dynamic player, our partnership with Mastercard and their Fintech Startup Nuclei will help us enhance our customers travel experience at every stage through this companion App as well as access all the lifestyle offers and benefits of their RAKBANK Emirates Skywards World Elite Mastercard Credit Card at home and abroad.”

“As the UAE continues to make strides in its digitization agenda, consumers are constantly looking for personalized and tailored experiences that offer them the best in rewards. In response to these evolving trends, Mastercard and RAKBANK are launching a one-of-its-kind offering in the market that will transform the payment experience for our cardholders. The new app will serve as a one-stop-shop that enables access to curated offers and tailored rewards uniquely suited to individual preferences. We are proud to work with our long-time strategic partners in making every day spends for consumer safe, secure and rewards,” said Girish Nanda, Country Manager, UAE and Pakistan, Mastercard.

RAKBANK Launches Green Financing Mechanisms in Ras Al Khaimah in Collaboration with Ras Al Khaimah Municipality

03/10/2021

Dubai, United Arab Emirates, 03 October 2021: In its constant efforts to contribute and promote a sustainable environment, the National Bank of Ras Al Khaimah (RAKBANK) signed an agreement with Ras Al Khaimah Municipality to launch green financing solutions in Ras Al Khaimah. The Municipality oversees the implementation of Ras Al Khaimah Energy Efficiency and Renewables Strategy 2040, which drives and promotes sustainability as a source of competitiveness for the emirate, by reducing the cost of energy and water for businesses, residents and the government. The agreement facilitates several financing options at preferential rates for green housing initiatives, green auto industry, as well as green personal financing solutions.

The Bank aligned its vision with that of the Ras Al Khaimah government by supporting Barjeel, the green building regulations of the emirate that aims to reduce 30% of energy and water consumption of new buildings. RAKBANK will offer an exclusive green mortgage loan at a competitive interest rate – to salaried and self-employed customers interested in buying Barjeel compliant homes with residual financing options, free pre-approvals, attractive discounts on processing and valuation fees, minimal paperwork and more.

RAKBANK will also present to customers based in Ras Al Khaimah with the ability to gain instant access to green auto loans on the condition that they purchase an electric or hybrid vehicles from Ras Al Khaimah based dealers at extremely competitive interest rates, including exclusive discounts on insurance rates. Furthermore, the Bank will extend, to Ras Al Khaimah based customers, a new personal loan at exclusive rates, to finance various green initiatives, such as, solar panel installations and purchase of energy efficient appliances, equipment and devices from licensed vendors in Ras Al Khaimah.

Commenting on the Green Loan Agreement, Peter England, CEO of RAKBANK said:
“In line with RAKBANK's environmental values of Preservation of Natural Resources, the Bank is proud to partner with the Ras Al Khaimah Municipality to encourage UAE Nationals and Expatriates alike to purchase a Barjeel compliant house, an electric or hybrid car, or even undertake home improvement projects to install solar panels that ultimately aim at reducing energy, water and gas consumption. At RAKBANK, we believe that our long-term success as a national bank lies in growing people’s trust in us by increasing our social responsibility towards our community and especially our environment.”

H.E. Munther Mohammed Bin Shekar, Director General of Ras Al Khaimah Municipality, said: “Our collaboration with RAKBANK to expand green finance in the emirate is one of the many steps we are taking to encourage sustainable lifestyles and business practices in Ras Al Khaimah. With this initiative, buying green becomes cheaper and more accessible. We would like to encourage residents and businesses who are about to invest in a new building or in improvements of their existing buildings, purchasing solar systems or new electric or hybrid vehicles, to explore how this initiative can help. Introduction of green financing practices is expected to draw more participation to our sustainability programs and therefore accelerate achievement of our strategic goals.”

The collaboration is expected to promote more sustainable purchase behaviors among residents and businesses, which in turn will contribute to the broader sustainability targets of Ras Al Khaimah, as part of the Ras Al Khaimah Energy Efficiency and Renewables Strategy 2040. The Strategy, established under the patronage of His Highness Sheikh Saud bin Saqr Al Qasimi, UAE Supreme Council Member and Ruler of Ras Al Khaimah, targets 30% energy savings, 20% water savings, and 20% contribution of electricity from renewable sources by 2040.

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