Highlights
Reported revenue of US$19 million for the first half, a year on year increase of nearly 80%
As of end of June, profit reached US$14 million, achieving a y-o-y increase of US$ 8 million, or 116% growth rate compared to the same period of last year
Year-on-year assets increased by US$ 1.55 billion, or 137% as of the end of June 2010
Fast growth of cross-border Renminbi (RMB) settlement since its launch in March of this year for the growing number of Chinese companies in the Middle East and Middle Eastern business in China
Dubai, 23 August 2011: The Industrial and Commercial Bank of China (ICBC) Middle East, a unit of the world's largest lending bank, updates the market today on its continued profitability in the first half of 2011. ICBC is the largest bank of China's state-owned commercial banks and was the first to develop operations in the Middle East which launched in 2008. Today, ICBC has a subsidiary in Dubai (DIFC) and branches in Abu Dhabi and Doha (QFC).
Tian Zhiping, CEO, ICBC Middle East said:
"Our results for the first half of 2011 confirm our strong confidence for the long-term growth potential of regional markets. Despite the political turbulence in the Middle East and North Africa we maintained significant growth across all areas of our business and we remain committed to pursuing our growth strategy for the region by increasing the scale of our existing business, broadening our range of products and services and expanding into new markets in the Middle East.
ICBC (601398.SH) is the world's biggest lender providing increasing support for regional economic development with a focus on petroleum, construction, telecommunications, aviation and natural resources. We are also well-positioned to facilitate the rapid growth of trade and investment between the Middle East and China."
Despite the regional unrest and the continued global economic downturn, ICBC Middle East recorded increased operating revenue of US$19 million, an increase of 80% compared to same period last year. First-half profits rose to US$ 14 million, a year-on-year increase of US$ 8 million or 116%. The balance sheet is strong with a robust increase in interest earning assets which increased by US$ 1,250 million, and are expected to contribute further to profit in the second half of this year.
In March 2011, ICBC launched its Cross-Border Renminbi (RMB) Trade Settlement business in the Middle East which is already accelerating the growth of the bank's total assets. The service was introduced in response to strong client demand and provides RMB settlement, purchase/sale and trade finance, as well as 'overseas loans against domestic guarantee' arrangements for its Chinese corporate clients and local clients. The rapid growth of ICBC's Cross-Border RMB Trade Settlement business is indicative of the development of bilateral trade and investment between the Middle East and China which ICBC is ideally-placed to support.
Deposits increased by 110% in the first half of this year, compared to the year end of 2010. Current deposit constitutes 81.41% of total customer deposit.
Fee income (including handling fees and commission fees) and net interest income are two drivers of ICBC's increase in revenues in the first half of 2011. Net interest income, the largest source of revenue, stood at US$26 million. In addition, fee income grew to US$7 million, representing an increase of US$ 5 million or 337% compared to the same period in 2010.
Growth plans
ICBC Middle East will continue to optimize its network in the region, keeping commercial banking as its main business while developing its investment banking and asset management services. The bank has plans to develop a retail banking business in the UAE, subject to regulatory approval, and also intends to expand further in the Middle East prioritising the growth of its business in Qatar and expansion into the Kingdom of Saudi Arabia and Kuwait.
Tian Zhiping added:
"ICBC is committed to increasing significantly its support for and involvement with the long-term economic development of the Middle East. We are also ideally-placed to work in partnership with more companies from the Middle East that are looking to expand their business in China, as well as supporting the growing number of Chinese companies transacting business in this region."