Dubai's oldest lender Mashreq swung to a loss in 2020 as revenue fell in a lower interest rate environment, but said it is "cautiously optimistic" that business will pick up in the second half of this year.
The bank reported a full-year loss of Dh1.27 billion ($347.8m), compared to a profit of Dh2.06bn in the same period in 2019 as revenue fell 14.1 per cent to Dh5.05bn, the bank said in a statement to the Dubai Financial Market, where its shares trade.
Impairments also increased to Dh3.35bn, up from Dh1.21bn in the prior year, as some corporate customers in sectors such as contracting and healthcare suffered losses.
The lender "took a prudent approach to safeguard Mashreq’s position, whilst doing everything in our power to help our customers prosper", chief executive Ahmed Abdelaal said.
"We expect to see a challenging first half in 2021, but are cautiously optimistic for a recovery in the second half," he added.
Banks across the world are facing tougher operating environments, with low interest rates making it difficult to earn profits and lenders having to incur higher provisions in anticipation of potential loan losses due to the impact of the Covid-19 pandemic.
Mashreq said the decline in revenue was a result of lower interest rates, while operating income was also weakened by one-off operational costs, as the lender "continued to invest in fundamental programmes that will position this bank for long term growth", chairman Abdulaziz Al Ghurair said.
New digital channels supported a 55 per cent increase in its client base, with 84 per cent of retail clients on-boarded online, the lender said.
"As we begin to look forward, it is important to recognise that the future of banking is rapidly merging with the trajectory of technology," Mr Abdelaal said.
"We believe investments in our digital platforms and operating model will deliver sustainable savings in the long term, and position us strongly for this existential change impacting our industry."
Before the pandemic, Mashreq said it planned to spend at least Dh500 million over a five-year period on digitisation, with the intent to shut half of its branches in the UAE in 2019.
2025 Fifa Club World Cup groups
Group A: Palmeiras, Porto, Al Ahly, Inter Miami.
Group B: Paris Saint-Germain, Atletico Madrid, Botafogo, Seattle.
Group C: Bayern Munich, Auckland City, Boca Juniors, Benfica.
Group D: Flamengo, ES Tunis, Chelsea, Leon.
Group E: River Plate, Urawa, Monterrey, Inter Milan.
Group F: Fluminense, Borussia Dortmund, Ulsan, Mamelodi Sundowns.
Group G: Manchester City, Wydad, Al Ain, Juventus.
Group H: Real Madrid, Al Hilal, Pachuca, Salzburg.
Results
Catchweight 60kg: Mohammed Al Katheeri (UAE) beat Mostafa El Hamy (EGY) TKO round 3
Light Heavyweight: Ibrahim El Sawi (EGY) no contest Kevin Oumar (COM) Unintentional knee by Oumer
Catchweight 73kg: Yazid Chouchane (ALG) beat Ahmad Al Boussairy (KUW) Unanimous decision
Featherweight: Faris Khaleel Asha (JOR) beat Yousef Al Housani (UAE) TKO in round 2 through foot injury
Welterweight: Omar Hussein (JOR) beat Yassin Najid (MAR); Split decision
Middleweight: Yousri Belgaroui (TUN) beat Sallah Eddine Dekhissi (MAR); Round-1 TKO
Lightweight: Abdullah Mohammed Ali Musalim (UAE) beat Medhat Hussein (EGY); Triangle choke submission
Welterweight: Abdulla Al Bousheiri (KUW) beat Sofiane Oudina (ALG); Triangle choke Round-1
Lightweight: Mohammad Yahya (UAE) beat Saleem Al Bakri (JOR); Unanimous decision
Bantamweight: Ali Taleb (IRQ) beat Nawras Abzakh (JOR); TKO round-2
Catchweight 63kg: Rany Saadeh (PAL) beat Abdel Ali Hariri (MAR); Unanimous decision
Killing of Qassem Suleimani
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RESULT
Copa del Rey, semi-final second leg
Real Madrid 0
Barcelona 3 (Suarez (50', 73' pen), Varane (69' OG)
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Bert van Marwijk factfile
Born: May 19 1952
Place of birth: Deventer, Netherlands
Playing position: Midfielder
Teams managed:
1998-2000 Fortuna Sittard
2000-2004 Feyenoord
2004-2006 Borussia Dortmund
2007-2008 Feyenoord
2008-2012 Netherlands
2013-2014 Hamburg
2015-2017 Saudi Arabia
2018 Australia
Major honours (manager):
2001/02 Uefa Cup, Feyenoord
2007/08 KNVB Cup, Feyenoord
World Cup runner-up, Netherlands
CABINET%20OF%20CURIOSITIES%20EPISODE%201%3A%20LOT%2036
%3Cp%3E%3Cstrong%3EDirector%3A%20%3C%2Fstrong%3EGuillermo%20del%20Toro%3Cbr%3E%3Cstrong%3EStars%3A%3C%2Fstrong%3E%20Tim%20Blake%20Nelson%2C%20Sebastian%20Roche%2C%20Elpidia%20Carrillo%3Cbr%3ERating%3A%204%2F5%3C%2Fp%3E%0A
