Dubai’s Mashreq Q2 profit falls on higher provisions
CEO optimistic on economy recovery.
July 30, 2010 8:32 by Reuters
Mashreq’s second-quarter net profit more than halved as Dubai’s largest bank by market value booked higher provisions against bad loans.
Its net profit was 202 million dirhams ($55.01 million) for the three months to June 30, based on Reuters calculations, down from 434.9 million dirhams.
Mashreq reported a first-half net profit of 453 million dirhams in a statement on Thursday.
“We see signs of recovery and are optimistic of early economic turnaround,” said Chief Executive Abdul Aziz Al Ghurair.
Mashreq shares are flat this year. It released its results after trading on the Dubai bourse.
Mashreq is on a shortlist for a banking licence in Libya, one of three regional banks in the running which will give foreign lenders a 49 percent stake in a new bank. Libya is expected to award the licence in coming weeks.
The UAE banking sector is heavily exposed to indebted state conglomerate Dubai World, with estimates of potential exposure ranging up to $15 billion, the majority believed to be held by Dubai banks, including Mashreq.
(Reporting by Dinesh Nair; writing by Erika Solomon; Editing by Jason Neely)