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Dubai: National Bank of Fujairah (NBF) announced its results for the three- month period ended March 31, recording net profit of Dh55.4 million - down 31 per cent from the profit in corresponding quarter of 2007.
"The net results were impacted by the global investment climate causing a significant decline in the fair value of the bank's investment portfolio," the bank said in a statement on Tuesday.
Investment losses for the quarter were Dh30.3 million as opposed to investment income of Dh22.5 million for the corresponding quarter of 2007.
The management considers the fair value losses as industry-driven and expects to see a recovery subject to global market conditions.
Core businesses maintained the growth in line with previous quarters on the back of strong growth in volumes despite pressure on margins due to excess domestic dirham liquidity and lower inter-bank interest yields.
Operating income excluding investment income showed a growth of 33.9 per cent compared to corresponding quarter of 2007. Net interest income rose by 27.9 per cent and fee income grew by 33 per cent.
"Whilst the first quarter results were affected by external factors, we are pleased to maintain the consistency of earnings in our core business areas and continued progress in retail and SME businesses," said NBF chief executive officer Steve Mullins.
Total assets and liabilities at Dh12.3 billion and Dh10.6 billion respectively grew by 42.1 per cent and 51.6 per cent respectively compared to the first quarter last year.
The return on average equity dropped from 19.8 per cent in 2007 to 12 per cent while return on average assets was down to 1.8 per cent for the quarter as opposed to 3.7 per cent in 2007, reflecting lower level earnings owing to the fall in income on account of investments' fair value adjustment.
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