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EGYPT – Abu Dhabi Islamic Bank of Egypt plans to launch a consumer finance company with a capital of EGP 100 million in the second quarter of this year, said Mohammad Ali, chief executive and managing director of Abu Dhabi Islamic Bank.
In order to reveal the bank’s operating performance in 2022 and its future plans, a microfinance company will also be established by the end of the second quarter of this year, Ali added at a roundtable attended by Egypt Daily News.
He explained that the bank is looking to achieve consolidation of non-bank financial services as it established Abu Dhabi Islamic Capital Egypt, Del Capital as its investment banking arm, and financial leasing company ADIFinance, which handles factoring and real estate. Increased financing activity.
Ali said the bank was restructuring some of its subsidiaries with the aim of making them profitable, such as the National Company for Glass and Crystal, which lost about 70 million Egyptian pounds in 2017, while the bank succeeded after the restructuring. completed, and sell them in 2022 for 231 million Egyptian pounds.
He added that the bank plans to liquidate some old non-profit companies, which are fully covered by the regulations, and that the liquidation will not have any impact on the banking business. These include the Assiut Agricultural Company, which owns 1,100 feddans in Assiut. On the other hand, it aims to allow other companies such as the Cairo State Investment Company to list on the Egyptian exchange.
The bank is also looking to launch a digital bank, he said, adding that it is waiting for the Central Bank of Egypt to announce the rules for launching them and get approval in the coming period.
Ali revealed that the bank aims to start financial derivatives business in accordance with the Shariah system and the bank’s Shariah committee by the end of the second quarter of this year.
Ali, on the other hand, said that Abu Dhabi Islamic Bank participated in the sale of the first sovereign sukuk to Egypt last February, worth $1.5 billion, noting that the bank received 15 percent of the value of the issue.
Ali explained that the relationship between the bank and the Ministry of Finance began in February 2019 to deal with the sukuk law, applying the best sukuk law in the world, in line with the goals of the Egyptian state and not to the detriment of its interests.
He added that the bank established a check company with a capital of EGP 10 million to increase the bank’s cooperation in this field.
He emphasized that the bank’s role is not only based on maximizing profitability and increasing the size of the budget, but is also committed to delivering value, in addition to supporting the Egyptian economy. In addition, the bank is working to strengthen trade links between Egypt and the UAE.
Abu Dhabi Islamic Bank’s chief executive said the bank’s strategy aimed at maximizing the size of its budget, which jumped from EGP 37 billion in 2017 to EGP 117 billion in 2022, exceeding the bank’s planned target.
The bank’s financial results showed that its net profit increased by EGP 739 million to EGP 2.19 billion in 2022, a 51% increase from 2021.
Standalone annual operating profit increased to EGP 4.447 billion, an increase of EGP 1.678 billion or 60.6% compared to 2021, while consolidated operating profit increased to EGP 4.559 billion, an increase of EGP 1.675 billion compared to 2021 an increase of 58%.
The net client financing portfolio continues to grow, reaching EGP 56.6 billion by the end of 2022, a 25% increase from 2021 and a market share of 1.65%. This increase was also offset by a 29% increase in total deposits to EGP 97.6 billion, for a market share of 1.25%.
According to Ali, the increase in customer financing was the result of an increase in the retail banking sector’s financing portfolio, which increased by EGP 1.3 billion, or 10 percent, to EGP 13.6 billion. The corporate sector financing portfolio also grew by approximately EGP 10.1 billion, a 31% increase to EGP 42.9 billion.
As for the small and medium enterprise (SME) sector and the commercial sector, Ali explained that Abu Dhabi Islamic Bank was one of the first private banks to focus on this sector. The bank managed to grow its SME portfolio to 25.3% of the total credit portfolio. The portfolio jumped from EGP 1.1 billion in 2018 to more than EGP 10 billion by the end of 2022, including some 3,360 SME clients.
He noted that total deposits increased significantly, reflecting an increase in personal deposits portfolio of approximately EGP 2.1 billion, a growth rate of 4.5 percent, to EGP 49.4 billion, and deposits in the corporate sector increased by EGP 19.8 billion, a growth rate of 70 percent , reaching EGP 48.2 billion by the end of 2022.
The bank’s latest consolidated financial report shows an increase in total revenue of approximately EGP 1.8 billion compared to 2021, a growth rate of 41%. This increase was due to an increase in return net income of EGP 1.3 billion, a growth rate of 38%, and an increase in other income of EGP 13 million, a growth rate of 6% compared to 2021.
On the other hand, the total annual expenditure was EGP 1.529 billion, an increase of EGP 86 million, while the cost-to-income ratio improved from 38% in 2021 to 29% in 2022.
The bank’s chief executive and managing director said, “2022 has witnessed difficult and tense global economic conditions, but despite all these challenges, we have maintained a level of profitability as the bank’s financial performance over the past year Reports show significant growth. Our banking operations are in compliance with Shariah principles.”
He added that these strong results were attributable to the bank’s ambitious commercial strategy and relentless pursuit of implementing expansion plans, offering the latest innovative products and serving diverse customer segments and economic sectors. Ali continued: “In addition to ADIB-Egypt’s exceptional financial performance in 2022, the bank has won 20 prestigious international awards for its excellence in delivering exceptional service to individual and corporate clients. The bank 15 more awards in 2021. Many of the most influential economic and banking magazines also praised ADIB-Egypt for its new initiatives that proved its worth throughout the year, thus cementing itself as one of the most successful, innovative and progressive banks status of banks in Egypt and the region.”
© 2022 Egypt Daily News. Supplied by SyndiGate Media Inc. (Syndicate Information).
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