Investments and fees lift second-quarter income for Sharjah Islamic Bank

Net income rose to Dh125.6 million compared to Dh97.7m a year earlier, the Sharjah-based bank said on Sunday.

Sharjah Islamic Bank, the largest Sharia-compliant lender in the emirate, said that its second-quarter income increased 28.5 per cent, boosted by investments, fees and commissions.

The gain came despite a decline in income from murabaha and leasing, the Islamic banking equivalent of the interest conventional banks make.

Net income rose to Dh125.6 million compared to Dh97.7m a year earlier, the Sharjah-based bank said yesterday. Investment, fees, commission and unspecified other income increased to Dh159.4m from Dh82.9m. Meanwhile, income from murabaha and leasing decreased to Dh204.5m from Dh208.2m.

Elsewhere, Bank of Sharjah said its net income for the first six months of this year was unchanged at Dh176m from the same period last year.

Ahmed Al Noman, the chairman of the bank’s board, said that the UAE banking industry is likely to be subject to further consolidation. His comments come after National Bank of Abu Dhabi and FGB said earlier this month that pending shareholder approval, they planned to merge with each other.

The combination of the emirate’s two biggest banks by assets will create a lender that can more than compete with Dubai’s largest lender, Emirates NBD, giving the new bank access to cheaper borrowing, improving its growth prospects, cutting costs and hopefully boosting its bottom line.

More than 50 banks and financial institutions serve 9 million customers in the UAE, making it one of the most crowded banking markets in the region.

Local banks have had a difficult couple of years amid the crash in oil prices and the introduction of a new crisis, such as the exit of the UK from the EU, which may cut global growth even more and reduce demand for oil and other hydrocarbons.

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