RAKBANK Reports Net Profit of AED 758.3 million for 2021

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1. For Immediate Release Press Release 01 /02/2022 RAKBANK Reports Net Profit of AED 758.3 million for 2021  RAKBANK’s Full-Year 2021 Net Profit increased by AED 252.9 million, a 50% increase over 2020  The Bank’s Total Assets increased by 6.7% to AED 56.3 billion during 2021  Gross Loans and Advances amounted to AED 34.2 billion as of 31st December 2021, a year-on-year increase of 6.1%  The Bank’s Non-Interest Income grew by 2.3% year-on-year United Arab Emirates, 01 February, 2022: The National Bank of Ras Al-Khaimah (“RAKBANK”) announced a consolidated Net Profit of AED 758.3 million for the Full-Year 2021, resulting in an increase of AED 252.9 million when compared to the previous year. The Bank’s Total Assets amounted to AED 56.3 billion, increasing by 6.7% over 2020. In addition, the Gross Loans and Advances closed at AED 34.2 billion, a year-on-year hike of 6.1%. Similarly, Customer Deposits grew by 1.9% and this is due to the growth in Time Deposits by 7.4% compared to the previous year, amounting to AED 660.1 million. Similarly, the Return on Average Assets Ratio closed the year at 1.4% compared to 0.9% for the previous year and Return on Average Equity was 9.5%, compared to 6.5% in 2020. The Board of Directors recommended distribution of a cash dividend of 22.5 fils per share for the shareholders’ consideration and approval at the Annual General Meeting (AGM). RAKBANK CEO, Peter England, commented: “RAKBANK had a strong finish to 2021, driving Net Profit for the year up to AED 758.3 million. We continue to transform our Bank with a focus on simplification, digitalization and building a culture of excellence. Throughout these past years, we have seen that RAKBANK’s resilience and nimbleness enabled us to offer sound support to our customers throughout the pandemic, with the help of the country’s regulators. Income growth has been a challenge in 2021 as a result of very little business activity during 2020. However, we saw this gradually turn around as the year progressed and the business momentum in the second half of 2021 reflected positively on the Bank’s performance. On Asset Quality, we have seen a significant improvement and our Provisions for 2021 are the lowest they have been in the last 6 years, indicating a strong rebound in the economy and the success of our business diversification strategy that we commenced in 2015.” FY 2021 highlights     Net Profit is up 50.0% compared to the previous year. Year-on-year increase in the Annualized Return on Assets amounting to 1.4% and Return on Equity to 9.5% respectively for the full year 2021. Non-performing Loans and Advances to Gross Loans and Advances Ratio improved to 4.1% as at 31 December 2021. Provision Charges for Credit Loss decreased by 35.3% year-on-year. Page 1 of 4
2. For Immediate Release Press Release 01 /02/2022 Performance review Total Income for the financial year ended 31 December 2021 amounted to AED 3.2 billion, which decreased by 9.4% as compared to the same period of the previous year. Net Interest Income and Net Income from Islamic Finance stood at AED 2.2 billion for the year 2021, decreasing by 14.1% year-on-year. Non-Interest Income increased by AED 23.7 million yearon-year to AED 1.1 billion, mainly due to an increase of AED 54.1 million in Net Fees and Commission Income. Operating Expenses remained the same year-on-year and the Cost to Income Ratio closed at 43.2% for the year. Gross Loans & Advances increased by AED 2.0 billion to AED 34.2 billion, which is a rise of 6.1% year-on-year resulting in an increase in the Bank’s Total Assets by 6.7% to AED 56.3 billion compared to 31 December 2020. Whereas, Customer Deposits grew by AED 702.8 million to AED 37.6 billion, a 1.9% increase compared to 31 December 2020. Asset quality Provision Charges for Credit Loss decreased by AED 586.6 million (FY 2021 Vs FY 2020), which is a 35.3% decrease year-on-year. The Non-Performing Loans and Advances to Gross Loans and Advances Ratio closed at 4.1% for the Full-Year 2021 compared to 5.2% as at 31 December 2020. RAKBANK is well provisioned against Loan Losses with a Loan Loss Coverage Ratio of 133.7%, excluding mortgaged properties and other realizable asset collateral available against loans. Capitalization and liquidity The Bank’s Total Capital Adequacy Ratio as per the Central Bank of the UAE regulations and as per Basel III stood at 17.0% at the end of December 2021. The Common Equity Tier 1 ratio of the Bank stood at 15.9%. The Loans to Stable Resources Ratio LSRR as at 31 December 2021, stood at 82.9% compared to 80.7% at the end of 2020, which is significantly lower than the maximum limit of 110%. The regulatory eligible Liquid Asset Ratio of the Group stood at 11.6% at the end of December 2021 compared to 14.5% at the end of 2020, which is well above the minimum requirement and reflects a healthy liquidity position. RAKBANK’s Chairman, H.E. Mohamed Omran Alshamsi, commented: “RAKBANK’s financial performance this past year yielded tangible results despite the operating environment of 2021. Looking back, during the first half of the year, the UAE economy was recovering from the impacts of COVID-19. However, the second half resulted in a complete turnaround, and this applied to RAKBANK as well. Just as the UAE economy continued to swiftly rebound, RAKBANK has demonstrated a similar form of resilience in 2021 underpinned by the Bank’s diversification strategy. It has become evident that we are well positioned for strong and sustainable growth in the years ahead. Our core business is primed to continue its steady growth on the back of rising Retail and SME activities. Additionally, throughout this past year, RAKBANK focused on investments specifically in digitising the customer journey as we believe that it will drive efficiency and unlock access to attractive new segments. Lastly, I would like to announce that as of February 2nd 2022, Mr Raheel Ahmed will officially assume his responsibilities as the Chief Executive Officer of RAKBANK, as his designated handover period is now complete.” Page 2 of 4
3. For Immediate Release Press Release 01 /02/2022 Financial highlights Income Statement Highlights (AED Mn) Net Interest Income and net income from Islamic financing Non-Interest Income Total Income Operating Expenditures Operating Profit Before Provisions for Impairment Provisions for Impairment Net Profit Quarter Results Q4 ‘21 Q4 `20 Variance% Full Year Results FY `20 Variance% FY ‘21 547.2 561.8 (2.6%) 2,168.4 2,525.6 (14.1%) 245.3 792.4 (371.1) 245.8 807.6 (363.7) (0.2%) (1.9%) (2.0%) 1,062.1 3,230.5 (1,395.6) 1,038.4 3,564.0 (1,395.3) 2.3% (9.4%) 0.0% 421.3 443.9 (5.1%) 1,835.0 2,168.7 (15.4%) (197.7) 223.6 (377.1) 66.7 47.6% 235.1% (1,076.7) 758.3 (1,663.3) 505.4 35.3% 50.0% Balance Sheet Highlights (AED Bn) Total Assets Gross Loans & Advances Deposits Results as at Dec ‘21 Sep ‘21 Dec `20 56.3 54.5 52.8 34.2 33.5 32.2 37.6 37.0 36.9 Variance Quarter-on-Quarter Year-on-Year 3.3% 6.7% 2.1% 6.1% 1.8% 1.9% Key Ratios Highlights Results as at Variance Quarter- on Year-on-Year Quarter 0.5% 3.0% 0.0% 0.5% 0.0% (0.5%) (1.2%) (4.0%) 0.4% 1.1% Percentage Dec ‘21 Sep ‘21 Dec `20 Return on Equity Return on Assets Net Interest Margin Cost to Income Impaired Loan Ratio Impaired Loan Coverage Ratio Basel III Total Capital Adequacy Ratio 9.5% 1.4% 4.1% 43.2% 4.1% 9.0% 1.4% 4.1% 42.0% 4.5% 6.5% 0.9% 4.6% 39.2% 5.2% 133.7% 134.3% 129.4% (0.6%) 4.3% 17.0% 17.8% 18.6% (0.8%) (1.6%) The Wholesale Banking and Financial Institutions lending was up by AED 1.5 billion compared to 2020 and Personal Banking’s Loan Portfolio also increased by AED 709.9 million. However, the Business Banking Loan Portfolio declined by AED 262.3 million compared to the previous year. Page 3 of 4
4. For Immediate Release Press Release 01 /02/2022 RAKBANK is currently rated by the following leading rating agencies, with their ratings provided below: Rating Agency Last update Deposits Outlook Moody’s October 2021 Baa1 / P-2 Stable Fitch December 2021 BBB+ / F2 Stable Capital Intelligence August 2021 A- / A2 Stable RAKBANK’s Environmental, Social and Governance (ESG) framework is currently rated as BBB by Morgan Stanley Capital International (MSCI). -Ends- About RAKBANK RAKBANK, also known as The National Bank of Ras Al Khaimah (P.S.C), is one of the UAE’s most dynamic financial institutions. Founded in 1976, it underwent a major transformation in 2001 as it rebranded into RAKBANK and shifted its focus from purely corporate to retail and small business banking. In addition to offering a wide range of Personal Banking services, the Bank increased its lending in the traditional SME, Commercial, and Corporate segment in recent years. The Bank also offers Islamic Banking solutions, via RAKislamic, throughout its 27 branches and its Telephone and Digital Banking channels. RAKBANK is a public joint stock company headquartered in the emirate of Ras Al Khaimah and listed on the Abu Dhabi Securities Exchange (ADX). For more information, please visit www.rakbank.ae or contact the Call Centre on +9714 213 0000. Alternatively, you can connect with RAKBANK via twitter.com/rakbanklive and facebook.com/rakbank. For media enquiries, please contact: Geraldine Dagher Geraldine@rakbank.ae Page 4 of 4