UAE’s Ajman Bank posted 42.969 million dirhams ($11.7 million) in profit for the six months ending June 30, a drop of 51.12% compared to the same period last year.
The Shariah-compliant bank paid up 94.360 million dirhams in impairment charges, an increase of 25.55% year-on-year, according to its bourse filing on Tuesday (July 28).
It said that any changes made to expected credit losses, or ECLs, to estimate the overall impact of COVID-19 is subject to “very high levels of uncertainty as limited forward-looking information is currently available on which to base those changes”.
For the six months, the bank reported a total deferred amount of customer financing of 398.958 million dirhams due to the impact of COVID-19. 73.02% are in its corporate banking portfolio.
Its Islamic financing exposure to COVID-19 was put at 3.857 billion dirhams, 63.79% of which are in consumer banking.
Overall, a 10.47% fall in net operating income, to 278.865 million dirhams, also contributed to its lower profit.
Financing and investing assets, the biggest component of the bank’s income, slid 8.24% to 448.007 million dirhams from 488.245 million dirhams for the same first six months in 2019.
Ajman Bank’s balance sheet also took a hit.
Assets nudged down by 0.3% to 23.554 billion dirhams from 23.626 billion dirhams at the end of 2019.
The bank’s financing and investment portfolio grew by 3.81% to 17.763 billion dirhams but investments securities decreased 6.01% to 1.898 billion dirhams.
Investment properties took a big hit, down by 53.32% to 365.646 million dirhams.
On the liabilities side, customers’ deposits were almost flat at 14.775 billion dirhams from 14.923 billion dirhams at the end of 2019.
The bank is 26.23% owned by the government of Ajman and 10.48% by Shaikh Humaid Rashed Humaid Alnuaimi, the ruler of the emirate.
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