Dubai: Financial Services provider Shuaa Capital on Wednesday reported a Dh3.6 million net profit for the third quarter of 2013, compared with a loss of Dh13.9 million during the same period last year.
Shuaa posted its second straight quarterly profit for the first time since the financial crisis on higher lending lending. The company has reported Dh54.8 million of total revenues, up 57 per cent from the Dh34.9 million during the third quarter of 2012.
The overall quality of incomes improved in the third quarter as 75 per cent of revenues were generated from recurring fee and interest income. While interest income for the period was Dh29.3 million, up 35 per cent from Dh21.6 million in the third quarter of 2012, the net fees and commission income surged to 11.9 million in the third quarter this year from Dh7.4 million in the same period in 2012.
“The improved market environment in the UAE drove client activity and our core businesses generated solid results. We are encouraged to see higher quality fee and interest income generation during the quarter,” said Shaikh Maktoum Hasher Al Maktoum, Executive Chairman of Shuaa Capital.
Company’s operating expenses in the third quarter decreased to Dh41.9 million from Dh46.7 million for the same period last year resulting in improved performance. Shuaa’s cost/income ratio saw a double-digit improvement to 76 per cent in the third quarter of 2013 from 134 per cent compared to the same period in 2012.
At the close of the third quarter Shuaa’s total assets stood at Dh1.5 billion. Loans, advances and finance leases rose by Dh114 million during the third quarter totalling to Dh845 millionyear to date.
“This is principally due to growth in lending activity of Gulf Finance Corporation (GFC) and Gulf Installments Company (GIC). Consequently the Group’s cash position was down 16 per cent to Dh202 million and total liabilities increased from Dh265 million to Dh372 million over the quarter,” the company said in a statement.
The asset management division booked quarterly revenues of Dh6.2 million that resulted in a near-doubling of the division’s net profits to Dh4.7 million. At the end of the quarter assets under management stood at Dh780 million compared to Dh714 million at the close of third quarter in 2012.
Shuaa’s net provisions for the quarter were up at Dh9 million in the third quarter compared to Dh1 million during the third quarter of 2012.