Dubai Islamic Bank: Consolidated Interim Financial Information - 30 September 2017

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1. Dubai Islamic Bank P .J.S.C. Review report and condensed consolidated interim financial information for the nine-month period ended 30 September 2017
2. Dubai Islamic Bank P .J.S.C. Review report and condensed consolidated interim financial information (Unaudited) for the nine-month period ended 30 September 2017 Pages Independent auditors’ report on review of the condensed consolidated interim financial information 1-2 Condensed consolidated interim statement of financial position 3 Condensed consolidated interim statement of profit or loss 4 Condensed consolidated interim statement of comprehensive income 5 Condensed consolidated interim statement of changes in equity 6 Condensed consolidated interim statement of cash flows Notes to the condensed consolidated interim financial information 7-8 9 – 30
6. Dubai Islamic Bank P .J.S.C. Condensed consolidated interim statement of profit or loss (Unaudited) for the nine-month period ended 30 September 2017 Three-month period ended 30 September Note NET INCOME Income from Islamic financing and investing transactions Commissions, fees and foreign exchange income Income from other investments measured at fair value, net Income from properties held for development and sale, net Income from investment properties Share of profit from associates and joint ventures Other income Total income Less: depositors’ and sukuk holders’ share of profit Net income OPERATING EXPENSES Personnel expenses General and administrative expenses Depreciation of investment properties Depreciation of property and equipment Total operating expenses Net operating income before impairment charges Impairment charges, net 17 Net profit for the period before income tax expense Income tax expense Net profit for the period Attributable to: Owners of the Bank Non-controlling interests Net profit for the period Basic and diluted earnings per share (AED per share) (note 18) Nine-month period ended 30 September 2017 AED’000 2016 AED’000 2017 AED’000 2016 AED’000 2,009,136 342,223 1,655,141 315,823 5,721,918 1,026,668 4,812,589 1,073,542 1,690 972 31,172 27,351 49,893 27,233 46,693 168,229 ————— 2,645,097 51,916 20,057 29,788 101,613 ————— 2,175,310 119,007 95,052 113,337 403,002 ————— 7,510,156 118,747 57,481 145,419 175,061 ————— 6,410,190 (640,254) ————— 2,004,843 ————— (483,373) ————— 1,691,937 ————— (1,828,758) ————— 5,681,398 ————— (1,362,646) ————— 5,047,544 ————— (383,887) (153,089) (11,548) (30,592) ————— (579,116) ————— (392,133) (134,458) (10,178) (28,532) ————— (565,301) ————— (1,174,209) (447,029) (33,336) (86,865) ————— (1,741,439) ————— (1,167,972) (429,437) (28,941) (89,662) ————— (1,716,012) ————— 1,425,727 1,126,636 3,939,959 3,331,532 (263,071) ————— (113,488) ————— (618,731) ————— (304,024) ————— 1,162,656 1,013,148 3,321,228 3,027,508 (4,576) ————— 1,158,080 ========= (6,849) ————— 1,006,299 ========= (19,845) ————— 3,301,383 ========= (16,882) ————— 3,010,626 ========= 1,107,123 50,957 ————— 1,158,080 ========= 876,324 129,975 ————— 1,006,299 ========= 3,172,972 128,411 ————— 3,301,383 ========= 2,680,569 330,057 ————— 3,010,626 ========= 0.18 ========= 0.13 ========= 0.55 ========= 0.49 ========= The notes on pages 9 to 30 form an integral part of these condensed consolidated interim financial information. The independent auditors’ report on review of condensed consolidated interim financial information is set out on page 1 & 2. 4
7. Dubai Islamic Bank P .J.S.C. Condensed consolidated interim statement of comprehensive income (Unaudited) for the nine-month period ended 30 September 2017 Three-month period ended 30 September 2016 2017 AED’000 AED’000 Net profit for the period Nine-month period ended 30 September 2016 2017 AED’000 AED’000 1,158,080 ————— 1,006,299 ————— 3,301,383 ————— 3,010,626 ————— 24,959 8,543 71,196 (92,755) 9,634 693 4,475 (3,051) ————— ————— ————— ————— 34,593 ————— 1,192,673 ========= 9,236 ————— 1,015,535 ========= 75,671 ————— 3,377,054 ========= (95,806) ————— 2,914,820 ========= 1,142,501 50,172 ————— 1,192,673 ========= 885,979 129,556 ————— 1,015,535 ========= 3,250,996 126,058 ————— 3,377,054 ========= 2,586,332 328,488 ————— 2,914,820 ========= Other comprehensive income / (loss) items Items that will not be reclassified subsequently to profit or loss: Fair value gain / (loss) on other investments carried at FVTOCI, net Items that may be reclassified subsequently to profit or loss: Exchange differences on translation of foreign operations, net Other comprehensive income / (loss) for the period Total comprehensive income for the period Attributable to: Owners of the Bank Non-controlling interests Total comprehensive income for the period The notes on page 9 to 30 form an integral part of these condensed consolidated interim financial information. The independent auditors’ report on review of condensed consolidated interim financial information is set out on page 1 & 2. 5
8. Dubai Islamic Bank P .J.S.C. Condensed consolidated interim statement of changes in equity (Unaudited) for the nine-month period ended 30 September 2017 ----------------------------------------------- Equity attributable to owners of the Bank -----------------------------Other reserves Investments Exchange Share Tier 1 and fair value translation Retained capital sukuk treasury reserve reserve Earnings Total shares AED’000 AED’000 AED’000 AED’000 AED’000 AED’000 AED’000 Noncontrolling interests Total equity AED’000 AED’000 Balance at 1 January 2016 3,953,751 7,346,000 5,617,539 (657,367) (354,829) 4,563,734 20,468,828 2,324,700 22,793,528 Net profit for the period Other comprehensive loss for the period --------------------------------------- --------------------------------------- --------------------------------------- (91,186) -------------------(91,186) -------------------- (3,051) -------------------(3,051) -------------------- 2,680,569 -------------------2,680,569 -------------------- 2,680,569 (94,237) -------------------2,586,332 -------------------- 330,057 (1,569) -------------------328,488 -------------------- 3,010,626 (95,806) -------------------2,914,820 -------------------- 988,438 -------------------4,942,189 -------------------7,346,000 2,168,018 25,000 -------------------7,810,557 -------------------(748,553) -----------------(357,880) (1,775,526) (983) (1,330) (477,490) 375 (25,000) (3,000) -------------------4,961,349 (1,775,526) (983) 3,156,456 (1,330) (477,490) 375 (3,000) -------------------23,953,662 (4,360) (726) -------------------2,648,102 (1,779,886) (983) 3,156,456 (1,330) (477,490) (351) (3,000) -------------------26,601,764 ====== ====== ====== ====== ===== ====== ====== ====== ====== Balance at 1 January 2017 4,942,189 7,346,000 7,785,557 (751,672) (462,774) 5,641,061 24,500,361 2,768,855 27,269,216 Net profit for the period Other comprehensive income / (loss) for the period --------------------------------------- --------------------------------------- --------------------------------------- 73,549 -------------------73,549 -------------------- 4,475 -------------------4,475 -------------------- 3,172,972 -------------------3,172,972 -------------------- 3,172,972 78,024 -------------------3,250,996 -------------------- 128,411 (2,353) -------------------126,058 -------------------- 3,301,383 75,671 -------------------3,377,054 -------------------- -------------------4,942,189 ======= -------------------7,346,000 ======= -------------------7,785,557 ======= 34 -------------------(678,089) ======= -------------------(458,299) ======= (2,219,403) (2,941) (34) (477,490) -------------------6,114,165 ======= (2,219,403) (2,941) (477,490) --------------------25,051,523 ======== (3,112) -------------------2,891,801 ======= (2,222,515) (2,941) (477,490) --------------------27,943,324 ======== Total comprehensive income / (loss) for the period Transaction with owners directly in equity: Dividend paid (note 24) Zakat Issue of right shares Share issue cost Tier 1 sukuk profit distribution Acquisition of non-controlling interest Transfer to regulatory credit risk reserve Board of Directors’ remuneration paid Balance at 30 September 2016 Total comprehensive income for the period Transaction with owners directly in equity: Dividend paid (note 24) Zakat Transfer on disposal of investments at FVTOCI Tier 1 sukuk profit distribution Balance at 30 September 2017 The notes on page 9 to 30 form an integral part of these condensed consolidated interim financial information. The independent auditors’ report on review of condensed consolidated interim financial information is set out on page 1 & 2. 6
9. Dubai Islamic Bank P .J.S.C. Condensed consolidated interim statement of cash flows (Unaudited) for the nine-month period ended 30 September 2017 Nine-month period ended 30 September 2017 2016 AED’000 AED’000 Operating activities Profit for the period before income tax expense Adjustments for: Share of profit of associates and joint ventures Income from disposal of properties held for development and sale Dividend income Gain on disposal of investment property Loss / (gain) on disposal of other investments Revaluation of investments at fair value through profit or loss Gain on sale of investments in Islamic sukuk Gain on disposal of property and equipment Depreciation of property and equipment Depreciation of investment properties Amortization of sukuk premium Provision for employees’ end-of-services benefit Impairment charge for the period, net Operating cash flow before changes in operating assets and liabilities Increase in due from banks and financial institutions with over three months maturity Increase in Islamic financing and investing assets Increase in receivables and other assets Increase in customers’ deposits Increase in due to banks and other financial institutions Increase / (decrease) in payables and other liabilities Cash generated from operations Employees’ end-of-services benefit paid Tax paid Net cash generated from operating activities Investing activities Net movement in investments in Islamic sukuk measured at amortised cost Purchase of investment properties Proceeds from sale of investment properties Purchase of property and equipment, net Proceeds from disposal of properties held for development and sale Net movement in other investments measured at fair value Dividend received Net movement in investments in associates and joint ventures Net cash used in investing activities 3,321,228 3,027,508 (113,337) (119,007) (31,599) (29,336) 375 82 (208,262) (177) 86,865 33,336 96 17,939 618,731 ---------------------3,576,934 (145,419) (118,747) (27,283) (128) 151 (89,133) (1,453) 89,662 28,941 18,398 304,024 ---------------------3,086,521 (17,143,496) (1,369,630) 21,197,836 3,150,951 240,627 ---------------------9,653,222 (7,828) (25,560) ---------------------9,619,834 ---------------------- 2,206,252 (14,716,382) (24,899) 11,860,261 4,587,893 (526,795) ---------------------6,472,851 (7,878) (16,384) ---------------------6,448,589 ---------------------- (1,563,146) (248,971) 57,115 (224,091) 167,471 11,489 31,599 16,373 ---------------------(1,752,161) ---------------------- (1,334,844) (215,168) 8,551 (140,657) 123,372 6,767 27,283 22,753 ---------------------(1,501,943) ---------------------- The notes on page 9 to 30 form an integral part of these condensed consolidated interim financial information. The independent auditors’ report on review of condensed consolidated interim financial information is set out on page 1 & 2. 7
10. Dubai Islamic Bank P .J.S.C. Condensed consolidated interim statement of cash flows (Unaudited) (continued) for the nine-month period ended 30 September 2017 Nine-month period ended 30 September 2017 2016 AED’000 AED’000 Financing activities Dividend paid Tier 1 sukuk profit distribution Proceeds from issuance of sukuk Payment of sukuk Proceeds from issuance of right shares, net Net cash (used in) / generated from financing activities Net increase in cash and cash equivalents Cash and cash equivalents at the beginning of the period Effect of exchange rate changes on the balance of cash held in foreign currencies Cash and cash equivalents at the end of the period (note 19) (2,222,515) (477,490) 3,814,728 (2,847,175) ---------------------(1,732,452) ---------------------- (1,779,886) (477,490) (1,836,500) 3,155,126 ---------------------2,734,250 ---------------------- 6,135,221 21,001,184 (12,493) ---------------------27,123,912 ========= 7,680,896 16,293,362 8,946 ---------------------23,983,204 ========= The notes on page 9 to 30 form an integral part of these condensed consolidated interim financial information. The independent auditors’ report on review of condensed consolidated interim financial information is set out on page 1 & 2. 8
11. Dubai Islamic Bank P .J.S.C. Notes to the condensed consolidated interim financial information for the nine-month period ended 30 September 2017 1. General information Dubai Islamic Bank (Public Joint Stock Company) (“the Bank”) was incorporated by an Amiri Decree issued on 29 Safar 1395 Hijri, corresponding to 12 March 1975 by His Highness, the Ruler of Dubai, to provide banking and related services based on Islamic Sharia’a principles. It was subsequently registered under the Commercial Companies Law number 8 of 1984 (as amended) as a Public Joint Stock Company. This condensed consolidated interim financial information combine the activities of the Bank and its subsidiaries as disclosed in Note 26 to these condensed consolidated interim financial information (together referred to as the “Group”). The Bank is listed on the Dubai Financial Market (Ticker: “DIB”). The Group is primarily engaged in corporate, retail and investment banking activities and carries out its operations through its local branches and overseas subsidiaries. The principal activities of the Group entities are described in note 26(a) to these condensed consolidated interim financial statements. The registered head office of the Bank is at P.O. Box 1080, Dubai, United Arab Emirates (“U.A.E.”). 2 Application of new and revised International Financial Reporting Standards (IFRSs) 2.1 New and revised IFRSs applied with no material effect on the condensed consolidated interim financial information The following revised IFRSs have been adopted in these condensed consolidated interim financial information. The application of these revised IFRSs has not had any material impact on the amounts reported for the current and prior periods but may affect the accounting for future transactions or arrangements:    Amendments to IAS 12 Income Taxes relating to recognition of Deferred Tax Assets for unrealised Losses. Amendments to IAS 7 Statement of Cash Flows to provide disclosures that enable users of financial statements to evaluate changes in liabilities arising from financing activities. Amendment to IFRS 12 related to disclosure requirements of interest in other entities. 2.2 New and revised standards in issue but not yet effective The Group has not early adopted the following new and revised standards that have been issued but are not yet effective: Effective for annual periods beginning on or after New and revised IFRSs Finalised version of IFRS 9 Financial Instruments (IFRS 9 Financial Instruments (2014)) was issued in July 2014 incorporating requirements for classification and measurement, impairment, general hedge accounting and de-recognition. This amends classification and measurement requirement of financial assets and introduces new expected loss impairment model. A new measurement category of fair value through other comprehensive income (FVTOCI) will apply for debt instruments held within a business model whose objective is achieved both by collecting contractual cash flows and selling financial assets. A new impairment model based on expected credit losses will apply to debt instruments measured at amortised costs or FVTOCI, lease receivables, contract assets and certain written loan commitments and financial guarantee contract 9 1 January 2018
12. Dubai Islamic Bank P .J.S.C. Notes to the condensed consolidated interim financial information for the nine-month period ended 30 September 2017 2 Application of new and revised International Financial Reporting Standards (IFRSs) (continued) 2.2 New and revised standards in issue but not yet effective (continued) New and revised IFRSs Effective for annual periods beginning on or after IFRS 16 Leases: IFRS 16 specifies how an IFRS reporter will recognise, measure, present and disclose leases. The standard provides a single lessee accounting model, requiring lessees to recognise assets and liabilities for all leases unless the lease term is 12 months or less or the underlying asset has a low value. Lessors continue to classify leases as operating or finance, with IFRS 16’s approach to lessor accounting substantially unchanged from its predecessor, IAS 17. 1 January 2019 IAS 40 Investment properties: The IASB has amended the requirements in IAS 40 Investment property on when a company should transfer a property asset to, or from, investment property. A transfer is made when and only when there is an actual change in use – i.e. an asset meets or ceases to meet the definition of investment property and there is evidence of the change in use. A change in management intention alone does not support a transfer. 1 January 2018 IAS 28 Investment in associates and joint ventures: A non-investment entity investor may elect to retain the fair value accounting applied by an investment entity associate or investment entity joint venture to its subsidiaries. This election can be made separately for each investment entity associate or joint venture 1 January 2018 IFRIC 22 Foreign Currency Transactions and Advance Consideration: When foreign currency consideration is paid or received in advance of the item it relates to – which may be an asset, an expense or income – IAS 21 The Effects of Changes in Foreign Exchange Rates is not clear on how to determine the transaction date for translating the related item. This has resulted in diversity in practice regarding the exchange rate used to translate the related item. IFRIC 22 clarifies that the transaction date is the date on which the company initially recognises the prepayment or deferred income arising from the advance consideration. For transactions involving multiple payments or receipts, each payment or receipt gives rise to a separate transaction date. 1 January 2018 As of date of issuance of these condensed consolidated interim financial statements, management are still in the process of evaluating the impact of these new and revised standards on the condensed consolidated interim financial statements. The Bank’s focus continues to be on developing the impairment models and processes which are needed for the parallel run during 2017 in order to be fully compliant with IFRS 9. The Bank believes that once they finalise the impairment model and processes, they will be in a better position to assess the potential impact of IFRS 9 on the condensed consolidated interim financial statements. 3. Basis of preparation 3.1 Statement of compliance These condensed consolidated interim financial information are prepared in accordance with International Accounting Standard 34. “Interim Financial Reporting” issued by the International Accounting Standards Board and applicable requirements of the laws of the U.A.E. UAE Federal Law No 2 of 2015 ("UAE Companies Law of 2015"). These condensed consolidated interim financial information do not include all the information required for a complete set of IFRS consolidated financial statements and should be read in conjunction with the Group’s audited consolidated financial statements for the year ended 31 December 2016. However, selected explanatory notes are included to explain events and transactions that are significant to an understanding of the changes in the Group’s financial position and performance since the last annual audited consolidated financial statements as at and for the year ended 31 December 2016. 10
13. Dubai Islamic Bank P .J.S.C. Notes to the condensed consolidated interim financial information for the nine-month period ended 30 September 2017 3. Basis of preparation (continued) 3.2 Judgments and estimates The preparation of these condensed consolidated interim financial information requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, equity, income and expense. Actual amount may differ from these estimates. In preparing these condensed consolidated interim financial information, the significant judgments made by management in applying the Group’s accounting policies and the key sources of estimates uncertainty were the same as those which were applied to the audited consolidated audited financial statements as at and for the year ended 31 December 2016. 4. Significant accounting policies The accounting policies used in the preparation of these condensed consolidated financial information are consistent with those disclosed in the audited consolidated financial statements as at and for the year ended 31 December 2016 other than the application of new and revised standards as set out in note 2.1. Summary of significant accounting policies applied in the preparation of these condensed consolidated interim financial information are as follows: 4.1 Financial risk management The Group’s financial risk management objectives and policies are consistent with those disclosed in the audited consolidated financial statements as at and for the year ended 31 December 2016. 4.2 Investments in Islamic Sukuk Investments in Islamic Sukuk are measured at amortised cost if both of the following conditions are met:   the asset is held within a business model whose objective is to hold assets in order to collect contractual cash flows; and the contractual terms of the instrument give rise on specified dates to cash flows that are solely payments of principal and profit on the principal amount outstanding. Investments in Islamic Sukuk meeting these criteria are measured initially at fair value plus transaction costs. They are subsequently measured at amortised cost using the effective yield basis less any impairment, with profit recognised on an effective yield basis in income from investments in Islamic Sukuk in the condensed consolidated interim statement of profit or loss. 4.3 Other investments 4.3.1 Investments measured at fair value through profit or loss (“FVTPL”) Investments in sharia compliant equity instruments are classified as at FVTPL, unless the Group designates an investment that is not held for trading as at fair value through other comprehensive income (FVTOCI) on initial recognition. Financial assets (other than equity instruments) that do not meet the amortised cost criteria are measured at FVTPL. In addition, financial assets (other than equity instruments) that meet the amortised cost criteria but are designated as at FVTPL are measured at FVTPL. Financial assets (other than equity instruments) may be designated as at FVTPL upon initial recognition if such designation eliminates or significantly reduces a measurement or recognition inconsistency that would arise from measuring assets or liabilities or recognising the gains and losses on them on different bases. The Group has not designated any financial assets (other than equity instruments) as at FVTPL. 11
14. Dubai Islamic Bank P .J.S.C. Notes to the condensed consolidated interim financial information for the nine-month period ended 30 September 2017 4. Significant accounting policies (continued) 4.3 Other investments (continued) 4.3.1 Investments measured at fair value through profit or loss (“FVTPL”) (continued) Financial assets are reclassified from amortised cost to FVTPL when the business model is changed such that the amortised cost criteria are no longer met. Reclassification of financial assets (other than equity instruments) that are designated as at FVTPL on initial recognition is not allowed. Financial assets at FVTPL are measured at fair value at the end of each reporting period, with any gains or losses arising on remeasurement recognised in the condensed consolidated interim statement of profit or loss. Dividend income on investments in equity instruments at FVTPL is recognised in the condensed consolidated interim statement of profit or loss when the Group’s right to receive the dividends is established in accordance with IAS 18 Revenue and is included in the condensed consolidated interim statement of profit or loss. 4.3.2 Investments measured at fair value through other comprehensive income (“FVTOCI”) On initial recognition, the Group can make an irrevocable election (on an instrument-by-instrument basis) to designate investments in sharia compliant equity instruments as at FVTOCI. Designation at FVTOCI is not permitted if the equity investment is held for trading. A financial asset is held for trading if:    it has been acquired principally for the purpose of selling it in the near term; or on initial recognition it is part of a portfolio of identified financial instruments that the Group manages together and has evidence of a recent actual pattern of short-term profit-taking; or it is an Islamic derivative that is not designated and effective as an Islamic hedging instrument or a financial guarantee. FVTOCI assets are initially measured at fair value plus transaction costs. Subsequently, they are measured at fair value with gains and losses arising from changes in fair value recognised in other comprehensive income. The cumulative gain or loss will not be reclassified to profit or loss on disposals. Dividends on these investments in equity instruments are recognised in condensed consolidated interim statement of profit or loss when the Group’s right to receive the dividends is established unless the dividends clearly represent a recovery of part of the cost of the investment. 4.4 Investment properties Investment properties are properties held to earn rentals and / or for capital appreciation (including property under construction for such purposes). Investment properties are measured at cost less accumulated depreciation and impairment loss. Depreciation on investment in buildings is charged on a straight-line basis over 25 years. An investment property is derecognised upon disposal or when the investment property is permanently withdrawn from use and no future economic benefits are expected from the disposal. Any gain or loss arising on derecognition of the property (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in the condensed consolidated interim statement of profit or loss in the period in which the property is derecognised. Transfers to investment properties are made when, and only when there is change in use evidenced by ending of owner-occupation, commencement of an operating lease to another party or ending of construction or development. Transfers from investment properties are made when, and only when, there is change in use evidenced by commencement of owner-occupation or commencement of development with a view to sale. 12
15. Dubai Islamic Bank P .J.S.C. Notes to the condensed consolidated interim financial information for the nine-month period ended 30 September 2017 4. Significant accounting policies (continued) 4.5 Investments in associates and joint ventures The results and assets and liabilities of associates and joint ventures are incorporated in these condensed consolidated interim financial information using the equity method of accounting. Under the equity method, an investment in associates and joint ventures is initially recognised in the condensed consolidated interim statement of financial position at cost and adjusted thereafter to recognise the Group’s share of the profit or loss and other comprehensive income of the associates and joint ventures. When the Group’s share of losses of associates and joint ventures exceeds the Group’s interest in that associates and joint ventures (which includes any long-term interests that, in substance, form part of the Group’s net investment in the associates and joint ventures), the Group discontinues recognising its share of further losses. Additional losses are recognised only to the extent that the Group has incurred legal or constructive obligations or made payments on behalf of the associate and joint venture. When a Group’s entity transacts with an associate or a joint venture of the Group, profits and losses resulting from the transactions with the associate or joint venture is recognised in the Group’ condensed consolidated interim financial information only to the extent of interests in the associate or joint venture that are not related to the Group. An investment in an associate or a joint venture is accounted for using the equity method from the date on which the investee becomes an associate or joint venture. On acquisition of the investment in an associate or a joint venture, any excess of the cost of acquisition over the Group’s share of the net fair value of the identifiable assets, liabilities and contingent liabilities of associates and joint ventures recognised at the date of acquisition is recognised as goodwill, which is included within the carrying amount of the investment. Any excess of the Group’s share of the net fair value of the identifiable assets, liabilities and contingent liabilities over the cost of acquisition, after reassessment, is recognised immediately in the condensed consolidated interim statement of profit or loss in the period in which the investment is acquired. The requirements of International Financial Reporting Standards are applied to determine whether it is necessary to recognise any impairment loss with respect to the Group’s investment in associate and joint venture. The Group discontinues the use of equity method from the date when the investment ceases to be an associate or a joint venture. The Group continues to use the equity method when an investment in an associate becomes an investment in a joint venture or an investment in joint venture becomes an investment in an associate. Upon disposal of associates and joint ventures that results in the Group losing significant influence over that associates and joint ventures, any retained investment is measured at fair value at that date and the fair value is regarded as its fair value on initial recognition as a financial asset in accordance with IFRS 9. The difference between the previous carrying amount of the associates and joint ventures attributable to the retained interest and its fair value is included in the determination of the gain or loss on disposal of the associates and joint ventures. In addition, the Group accounts for all amounts previously recognised in other comprehensive income in relation to that associates and joint ventures on the same basis as would be required if that associates and joint ventures had directly disposed of the related assets or liabilities. Therefore, if a gain or loss previously recognised in other comprehensive income by that associates and joint ventures would be reclassified to profit or loss on the disposal of the related assets or liabilities, the Group reclassifies the gain or loss from equity to profit or loss (as a reclassification adjustment) when it loses significant influence over that associates and joint ventures. 13
16. Dubai Islamic Bank P .J.S.C. Notes to the condensed consolidated interim financial information for the nine-month period ended 30 September 2017 5. Cash and balances with central banks 5.1 Analysis by category Note Cash on hand Balances with the central banks: Balances and reserve requirements with central banks International Murabaha with the Central Bank of the U.A.E. 5.3 Total 5.2 Audited 31 December 2016 AED’000 1,646,570 1,886,914 7,516,039 9,766,858 13,504,231 ––––––––– 22,666,840 ======== 5,000,909 ––––––––– 16,654,681 ======== Unaudited 30 September 2017 AED’000 Audited 31 December 2016 AED’000 22,316,627 350,213 ––––––––– 22,666,840 ======== 16,202,716 451,965 ––––––––– 16,654,681 ======== Analysis by geography Within the U.A.E. Outside the U.A.E. Total 5.3 Unaudited 30 September 2017 AED’000 Statutory cash reserve requirements The reserve requirements are kept with the Central Banks of the U.A.E. and Pakistan in the respective local currencies and US Dollar. These reserves are not available for use in the Group’s day to day operations, and cannot be withdrawn without the approval of the respective central banks. The level of reserve required changes every month in accordance with the requirements of the respective central banks’ directives. 6. Due from banks and financial institutions 6.1 Analysis by geography Within the U.A.E. Outside the U.A.E. Total 14 Unaudited 30 September 2017 AED’000 Audited 31 December 2016 AED’000 3,307,392 1,349,374 ––––––––– 4,656,766 ======== 2,389,820 2,156,377 ––––––––– 4,546,197 ========
17. Dubai Islamic Bank P .J.S.C. Notes to the condensed consolidated interim financial information for the nine-month period ended 30 September 2017 7. Islamic financing and investing assets, net 7.1 Analysis by category Note Islamic financing assets Vehicles murabahas Commodities murabahas Real estate murabahas International murabahas - long term Total murabahas Ijaras Home finance ijarah Personal finance Istisna’a Islamic credit cards Less: deferred income Less: contractors’ and consultants’ istisna’a contracts Total Islamic financing assets Islamic investing assets Musharakas Mudarabas Wakalas Total Islamic investing assets Total Islamic financing and investing assets Less: provisions for impairment 7.3 Total Islamic financing and investing assets, net 7.2 Unaudited 30 September 2017 AED’000 Audited 31 December 2016 AED’000 10,096,431 4,781,598 1,448,166 21,879,804 –––––––––– 38,205,999 10,340,585 4,375,004 1,619,802 18,940,481 -------------------35,275,872 44,984,240 12,892,295 17,377,808 1,451,999 1,056,957 –––––––––– 115,969,298 (4,241,018) (39,326) –––––––––– 111,688,954 –––––––––– 36,120,709 12,510,531 15,677,737 2,134,869 961,046 -------------------102,680,764 (3,516,953) (107,231) -------------------99,056,580 -------------------- 7,215,352 14,010,063 4,159,871 –––––––––– 25,385,286 –––––––––– 137,074,240 6,439,908 12,357,683 2,672,102 -------------------21,469,693 -------------------120,526,273 (5,790,464) –––––––––– 131,283,776 ========= (5,558,651) ---------------------114,967,622 ========= Unaudited 30 September 2017 AED’000 Audited 31 December 2016 AED’000 123,332,623 13,741,617 –––––––––– 137,074,240 (5,790,464) –––––––––– 131,283,776 ========= 113,146,549 7,379,724 –––––––––– 120,526,273 (5,558,651) –––––––––– 114,967,622 ========= Analysis by geography Within the U.A.E. Outside the U.A.E. Total Islamic financing and investing assets Less: provisions for impairment 7.3 Total Islamic financing and investing assets, net 15
18. Dubai Islamic Bank P .J.S.C. Notes to the condensed consolidated interim financial information for the nine-month period ended 30 September 2017 7. Islamic financing and investing assets, net (continued) 7.3 Provision for impairment Unaudited 30 September 2017 AED’000 Audited 31 December 2016 AED’000 5,558,651 5,048,097 1,197,708 219,462 (772,899) (412,458) ––––––––– 5,790,464 ======== 1,861,022 251,038 (1,149,491) (452,015) –––––––– 5,558,651 ======= Unaudited 30 September 2017 AED’000 Audited 31 December 2016 AED’000 13,739,852 3,735,831 7,694,001 -------------------25,169,684 ======== 14,816,908 1,246,017 7,345,735 -------------------23,408,660 ======== Balance at the beginning of the period / year Charge for the period / year Specific Collective Release to consolidated statement of profit or loss Write off Balance at the end of the period / year 8. Investments in Islamic sukuk measured at amortised cost 8.1 Analysis by geography Within the U.A.E. Other G.C.C. Countries Rest of the world Total Investments in Islamic sukuk measured at amortised cost within the U.A.E. include investments in bilateral governmental sukuk amounting to AED 3.2 billion as at 30 September 2017 (31 December 2016: AED 3.2 billion). 9. Other investments measured at fair value 9.1 Analysis by category and geography Within the U.A.E. AED’000 Other G.C.C. countries AED’000 1,837 --------------------755,504 575,582 --------------------1,331,086 --------------------1,332,923 ========= Rest of the world AED’000 Total AED’000 2,328 --------------------- --------------------- 4,165 ------------------ 150,542 57,194 --------------------207,736 --------------------210,064 ========= 2,143 237,808 --------------------239,951 --------------------239,951 ========= 908,189 870,584 ------------------1,778,773 ------------------1,782,938 ======== 30 September 2017 (Unaudited) Investments designated at fair value through profit or loss Quoted equity instruments Investments measured at fair value through other comprehensive income Quoted equity instruments Unquoted equity instruments and funds Total 16
19. Dubai Islamic Bank P .J.S.C. Notes to the condensed consolidated interim financial information for the nine-month period ended 30 September 2017 9. Other investments measured at fair value (continued) 9.1 Analysis by category and geography (continued) 31 December 2016 (Audited) Investments designated at fair value through profit or loss Quoted equity instruments Investments measured at fair value through other comprehensive income Quoted equity instruments Unquoted equity instruments and funds Total 10. Within the U.A.E. AED’000 Other G.C.C. countries AED’000 Rest of the world AED’000 Total AED’000 2,495 -------------------- 366 -------------------- -------------------- 2,861 ----------------- 675,966 576,372 -------------------1,252,338 -------------------1,254,833 ======== 137,930 69,757 -------------------207,687 -------------------208,053 ======== 3,027 251,398 -------------------254,425 -------------------254,425 ======== 816,923 897,527 -----------------1,714,450 -----------------1,717,311 ======= Other real estate AED’000 Investment properties under construction AED’000 Land AED’000 Total AED’000 802,832 171,994 -----------------974,826 ------------------ 1,661,347 -----------------1,661,347 ------------------ 750,068 52,545 ---------------802,613 ---------------- 3,214,247 224,539 -----------------3,438,786 ------------------ 663,241 164,453 -----------------827,694 ------------------ 1,437,461 -----------------1,437,461 ------------------ 740,615 52,545 ---------------793,160 ---------------- 2,841,317 216,998 -----------------3,058,315 ----------------- Investment properties 10.1 Analysis by category and geography 30 September 2017 (Unaudited) Carrying Amount: Within the U.A.E. Outside the U.A.E. Total 31 December 2016 (Audited) Carrying Amount: Within the U.A.E. Outside the U.A.E. Total 17
20. Dubai Islamic Bank P .J.S.C. Notes to the condensed consolidated interim financial information for the nine-month period ended 30 September 2017 11 Customers’ deposits 11.1 Analysis by category Unaudited 30 September 2017 AED’000 Current accounts Saving accounts Investment deposits Margin accounts Depositors’ investment risk reserve Depositors’ share of profit payable Total 12. Audited 31 December 2016 AED’000 30,981,060 19,370,457 92,532,289 519,446 16,015 109,153 ---------------------143,528,420 ========= 29,006,775 17,848,031 74,905,616 488,947 19,733 107,848 ---------------------122,376,950 ========= Unaudited 30 September 2017 AED’000 Audited 31 December 2016 AED’000 2,754,750 1,836,500 256,826 3,673,000 141,728 -------------------8,662,804 ======== 2,754,750 1,836,500 256,730 1,836,500 1,010,675 ------------------7,695,155 ======== Sukuk issued The analysis of the Sukuk instruments issued by the Group is as follows: Sukuk issued by the Bank Sukuk issued by the Bank Sukuk issued by the Bank Sukuk issued by the Bank Sukuk issued by a subsidiary Sukuk issued by the Bank Sukuk issued by a subsidiary Expected annual profit rate Maturity 2.92% 3.60% 3 M Libor + 150 bps 3.66% 6 M Kibor + 50 bps 4.75% 5.15% June 2020 March 2021 December 2019 February 2022 June 2027 May 2017 January 2017 Total 13. Share capital As at 30 September 2017, 4,942,188,884 authorised ordinary shares of AED 1 each (31 December 2016: 4,942,188,884 ordinary shares of AED 1 each) were fully issued and paid up. 18