Mashreq’s net profit surges 130% to $2.3bn in 2023

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Dubai-listed Mashreq reported a net profit increase of 130 percent year on year to AED8.6 billion ($2.34 billion) in 2023, as net interest income grew 69 percent year on year.

Earnings growth was driven by robust client margins, a continued high-interest rate environment, and positive one-off impacts related to loan loss provisioning.

The lender’s non-interest income reached AED3.1 billion, a 13 percent yearly growth.

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Operating profit surged 70 percent to AED7.5 billion last year from AED4.4 billion in 2022.

Return on equity hit a record high of 34.3 percent in 2023, doubling compared to 2022. However, the cost-to-income ratio decreased to 30.9 percent annually.

“With the UAE banking sector reaching a historic high and total assets crossing the AED4 trillion mark, we look forward to 2024 with a sense of optimism and readiness,” AbdulAziz Al Ghurair, chairman of Mashreq, said.

“Looking ahead, our course and position remain resolute, even in the face of ongoing uncertainty,” Ahmed Abdelaal, group chief executive officer, Mashreq, added.

“It is imperative, however, that we brace ourselves for the normalisation of interest rates, which will necessitate adjustments in operational strategies to align with this new reality.”

Total customer deposits increased 28.5 percent annually to AED146.23 billion last year. Loans and advances jumped 25.2 percent year on year to AED149.48 billion.