Mashreq Posts Record Dh7.3bn Nine-Month Profit as Lending Jumps 33%

Mashreq Bank, a Dubai-based lender, announced a record pre-tax profit of Dh7.3 billion for the first nine months of 2026, an 18 percent increase compared to the same period last year. The results were driven by a 33 percent surge in customer lending and a reversal in impairment charges.

Operating income for the nine-month period climbed 11 percent to Dh10.4 billion. Total assets expanded by Dh100 billion year-on-year to reach Dh405.6 billion. Net profit after tax advanced 18 percent to Dh6.1 billion, while profit attributable to owners of the parent company rose by the same percentage to Dh6.0 billion.

Profitability and Returns

Return on equity stood at 20.4 percent, up from 19.8 percent in the corresponding period of 2025. Return on assets was 2.1 percent. Earnings per share increased 17 percent to Dh28.8.

Abdul Aziz Al Ghurair, chairman of Mashreq, said the UAE continued to demonstrate “the strength of its economic model”, noting that the banking sector was instrumental in supporting that momentum. Group Chief Executive Officer Ahmed Abdelaal described the results as evidence of the bank’s “ability to grow the franchise while maintaining strong returns and credit quality”.

For the third quarter alone, pre-tax profit reached Dh2.5 billion, up 19 percent from the same quarter of 2025. Net profit after tax for the quarter grew 21 percent year-on-year to Dh2.1 billion. Quarterly operating income rose 12 percent year-on-year to Dh3.6 billion.

Of the nine-month increase in pre-tax profit, Dh635 million came from a 10 percent rise in operating profit. An additional Dh482 million was attributable to an improved impairment picture: the bank recorded a net release of Dh116 million, compared with a charge of Dh366 million a year earlier.

Lending and Deposits

Customer loans expanded 33 percent year-on-year to Dh190.6 billion, including a net increase of Dh21.5 billion, or 13 percent, in the third quarter alone across wholesale and retail clients. Customer deposits rose 27 percent to Dh237.1 billion. The share of current and savings accounts (CASA) stood at 58 percent.

The investment portfolio grew 75 percent to Dh83.7 billion as surplus liquidity was placed into high-quality securities. The loan-to-deposit ratio was 80 percent, up from 74 percent at the end of June.

The non-performing loan ratio improved to 0.7 percent from 1.1 percent a year earlier and 0.9 percent at the end of June. Non-performing loans also declined in absolute terms during the third quarter, despite rapid lending growth. Coverage rose to 311 percent from 235 percent in September 2025.

Net interest income increased 7 percent to Dh6.5 billion, while non-interest income grew 18 percent to Dh3.9 billion, lifting its share of total income to 37 percent. Net investment income nearly doubled to Dh599 million, supported by favourable fair-value movements and realised gains. Net fee and commission income rose 4 percent to Dh1.08 billion; third-quarter fees were 45 percent higher than the previous quarter but 7 percent lower year-on-year. Insurance, foreign exchange and other income increased 13 percent to Dh2.2 billion.

Net interest margin for the nine months stood at 2.71 percent, compared with 3.2 percent a year earlier, as deposit inflows were placed in liquid securities ahead of redeployment into lending.

Expenses and Business Lines

By business line, Wholesale Banking, the largest segment accounting for 39 percent of operating income, grew 3 percent to Dh4.1 billion. Retail Banking expanded 10 percent to Dh3.7 billion, while Treasury and Global Markets grew 24 percent to Dh1.6 billion.

Operating expenses rose 13 percent to Dh3.3 billion, directed towards generative AI initiatives, digital platforms and talent. The cost-to-income ratio was 31.4 percent, compared with 30.7 percent a year earlier, improving to 31.3 percent in the third quarter from 31.9 percent in the second.

The Capital Adequacy Ratio stood at 16.7 percent as of 30 September, compared with 14.5 percent in December 2025. Tier 1 capital was 15.6 percent and Common Equity Tier 1 stood at 13.2 percent.

For the remainder of 2026, the bank said it would focus on deepening lending and expanding its retail and SME franchises, among other areas.