RAKBANK Achieves AED 772M Profit Amidst Global Uncertainty
This robust performance comes despite increasing global economic uncertainties, highlighting the bank's resilience and strategic focus.
The National Bank of Ras Al Khaimah (RAKBANK) has released its financial performance for the first quarter of 2025, showcasing impressive growth and operational resilience.
Key Financial Highlights – Q1 2025
Significant Rise in Profitability: RAKBANK recorded a net profit of AED 704 million for Q1 2025, marking a robust 22.7% increase compared to the same period last year. This performance reflects the bank’s focused strategy and healthy business momentum.
Solid Operating Income Growth: Operating profit reached AED 866 million, up 10.2% year-on-year. This growth was underpinned by expansion in the bank’s balance sheet and a strong uptick in non-interest income streams.
Continued Investment in Growth Areas: Operating expenses increased by 11.8% over Q1 2024, driven by ongoing investments in technology infrastructure, data capabilities, talent acquisition, and overall customer experience. The cost-to-income ratio remained stable at 33.4%, slightly higher than 33.1% in Q1 2024.
Record-Breaking Total Assets: For the first time in its history, RAKBANK’s total assets surpassed AED 90 billion, underscoring the bank’s growing scale and solid financial foundation.
Loan Portfolio Expansion Across All Segments: Gross loans and advances exceeded AED 50 billion, reflecting a 16.7% year-on-year increase. This growth was broad-based, with Wholesale Banking loans rising by a notable 30.1%, in line with the bank’s strategy to diversify its lending portfolio.
Strong Growth in Customer Deposits: Customer deposits grew to AED 61.0 billion, a year-on-year increase of 18.2%. The CASA (current and savings account) ratio rose to 65%, up 10.2% from the previous year, placing RAKBANK among the leaders in the sector.
Improved Credit Quality: The bank’s credit quality continues to strengthen, with the cost of risk declining to 0.8%, compared to 1.5% in Q1 2024. This improvement is largely due to a strategic pivot toward secured, lower-risk lending.
Lower Impaired Loan Ratio: RAKBANK’s impaired loan ratio fell to 2.1%, down from 2.6% a year ago. The bank’s provision coverage remains strong, with a provisions-to-gross-loans ratio of 5.6%, compared to 6.0% in Q1 2024.
Strong Shareholder Returns: Return on Equity (ROE) rose to 22.4%, up from 21.4% in Q1 2024, while Return on Assets (ROA) edged up to 3.2% from 3.1% in the same period. These gains reflect the bank’s consistent focus on value creation for shareholders.
Healthy Capital and Liquidity Buffers
RAKBANK remains well-capitalized, with a capital adequacy ratio (CAR) of 18.6%, up from 17.2% last year. Its liquidity position also improved, as shown by an Eligible Liquid Asset Ratio of 17.1% and an Advances to Stable Resources Ratio of 76.4%, compared to 78.7% in Q1 2024.
Raheel Ahmed, Group Chief Executive Officer, RAKBANK, said: “We’ve kicked off 2025 with a record-breaking performance, marking the strongest quarter in RAKBANK’s history a profit before tax of AED 772 million. We also crossed AED 90 billion in total assets for the first time in our history, a major milestone that reflects our strong momentum, the quality of our products and services, and the deep trust our customers continue to place in us. Our Q1 2025 performance highlights the sustainability of our strategy, driven by strong growth across all business lines. We continue to invest heavily in our technology, data and experience capabilities whilst maintaining cost discipline.”
“Our strategic ambition to become the ‘digital bank with a human touch’ is gaining real traction. Whether it’s in how we serve our customers or how we simplify and scale operations, the shift is well underway. Our digital banking platforms were accessed over 53 million times in the last 12 months, and digital transactions rose by 17% YoY. At the same time, we continue to deepen relationships with our customers, with deposits growing by 10.2% YoY and CASA balances now approaching AED 40 billion. In line with our ongoing commitment to delivering a premium experience to our customers, we have opened two world-class Elite Centres for our customers - one in Dubai and one in Abu Dhabi. As we look ahead, we will continue to push forward, driving innovation, simplifying banking, and delivering long-term value for our customers, our people, and our shareholders.”
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