National Bank of Ras Al Khaimah reported a 25.4 per cent surge in its first-quarter net profit as loans and advances grew and impairment charges fell amid continued economic recovery.
Net income for the three months to the end of June climbed to Dh191.2 million ($52.1m), the bank said in a statement on Tuesday to the Abu Dhabi Securities Exchange, where its shares are traded.
Provisions for credit losses for the quarter decreased by Dh114.4m to Dh296.6m, a more than 27 per cent year-on-year drop. Loans and advances grew to Dh33.2 billion, a 3.1 per cent increase from the end of December 2020 level, the bank said.
“This is a crucial turning point for us as we see growth in our loan book and customer deposit and that is a very positive sign,” RAKBank chief executive, Peter England, said. “Our provisions for this quarter are the lowest they have been for many years as we see the re-balancing of our portfolio, which we have undertaken over the years, bear very positive results.”
The second quarter was “very strong” for the bank, with total income also growing after a number of quarters of decline since the beginning of the pandemic, he said.
RAKBank’s total income for the three months to June-end rose to Dh831.8m, from Dh800m recorded in the first quarter of this year.
“It also demonstrates the significant rebound in the UAE economy and a strong return of consumer confidence that we have witnessed during the first half of this year,” Mr England said.
Like their global peers, banks in the UAE faced headwinds last year as the Covid-19 pandemic disrupted economic activity. However, operating conditions have improved as the economy recovers on the back of monetary and fiscal support and continuing mass inoculation programme.
The UAE has so far introduced economic support measures worth Dh388bn after the pandemic tipped the global economy into its worst recession since the 1930s. As part of its support measures, the Central Bank of the UAE also introduced Dh50bn Targeted Economic Support Scheme to boost liquidity in the banking and financial sector.
RAKBank's total assets increased by Dh1.5bn to Dh54.3bn from the end of December 2020 level. Its investments also climbed by Dh949m for the period.
The lender said it is sufficiently provisioned against loan losses, with a coverage ratio of 127.7 per cent and is bullish on growth amid the continuing economic bounce-back.
“We are very encouraged with the signs we are seeing both for RAKBank and the broader UAE economy going forward,” Mr England said. “We expect to see continual improvement in the coming quarters with sustained income growth, lower provisions and sound cost control.”
The second quarter has marked the “beginning of a turnaround” for the bank after “very challenging 12 months” and it will remain focused on further digitalisation across its businesses, he added.
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Developer: Treyarch, Raven Software
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Console: PlayStation 4 & 5, Windows, Xbox One & Series X/S
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Bloomsbury Academic
OIL PLEDGE
At the start of Russia's invasion, IEA member countries held 1.5 billion barrels in public reserves and about 575 million barrels under obligations with industry, according to the agency's website. The two collective actions of the IEA this year of 62.7 million barrels, which was agreed on March 1, and this week's 120 million barrels amount to 9 per cent of total emergency reserves, it added.
Red flags
- Promises of high, fixed or 'guaranteed' returns.
- Unregulated structured products or complex investments often used to bypass traditional safeguards.
- Lack of clear information, vague language, no access to audited financials.
- Overseas companies targeting investors in other jurisdictions - this can make legal recovery difficult.
- Hard-selling tactics - creating urgency, offering 'exclusive' deals.
Courtesy: Carol Glynn, founder of Conscious Finance Coaching
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What the law says
Micro-retirement is not a recognised concept or employment status under Federal Decree Law No. 33 of 2021 on the Regulation of Labour Relations (as amended) (UAE Labour Law). As such, it reflects a voluntary work-life balance practice, rather than a recognised legal employment category, according to Dilini Loku, senior associate for law firm Gateley Middle East.
“Some companies may offer formal sabbatical policies or career break programmes; however, beyond such arrangements, there is no automatic right or statutory entitlement to extended breaks,” she explains.
“Any leave taken beyond statutory entitlements, such as annual leave, is typically regarded as unpaid leave in accordance with Article 33 of the UAE Labour Law. While employees may legally take unpaid leave, such requests are subject to the employer’s discretion and require approval.”
If an employee resigns to pursue micro-retirement, the employment contract is terminated, and the employer is under no legal obligation to rehire the employee in the future unless specific contractual agreements are in place (such as return-to-work arrangements), which are generally uncommon, Ms Loku adds.
