Al Rayan Bank UK profits increase by over 700% in 2015

25 April 2016

Al Rayan Bank PLC in the UK today announced that 2015 was the most profitable year in its history, as its post-tax profits rose by more than 700%, from £1.2million in 2014 to £10.3million. The results continue the Bank’s upward profitability trajectory that was set in motion when the Bank was acquired by Masraf Al Rayan, QSC (MAR) in February 2014.

Other highlights from its 2015 Annual Report include:

  • Customer financing increased by 61% and includes:
    - Home Purchase Plan (HPP) financing, which increased by 46% to £455million
    - Commercial Property Finance, which increased by 97% to £273million
  • Retail deposits grew by 43% to over £731million and wholesale deposits by 391% to £156million
  • The Bank’s investments in Sukuks (Islamic bonds) increased to £121million

Al Rayan Bank’s impressive financial results have been enabled by a combination of a growing customer base and the implementation of a strategic growth plan set by its board of directors last year. The Bank launched new financing products and services targeting High Net Worth Individuals (HNWI) and other corporate investors that helped it to secure higher value transactions, realised process efficiencies and increased accessibility for customers through an enhanced website and new mobile banking application.

In May 2015, the Bank launched its Premier/Private banking service by opening a dedicated flagship branch in Knightsbridge; a location that helped it to become accessible to new high net worth customers, including those from the Gulf Cooperation Council countries (GCC), where MAR has an extremely strong brand presence and reputation. In September Al Rayan Bank’s growing workforce necessitated a move to a new, larger Operational Headquarters in Birmingham.

Robert Sharpe, Chairman, Al Rayan Bank, said: “These are an excellent set of results. Al Rayan Bank is growing at a rapid, but manageable and well controlled pace. This impressive growth is being delivered from within a framework of a robust risk management culture and is carefully fostered in an environment where everyone within the Bank is responsible for risk. The £100million capital investment from Masraf Al Rayan had a transformational impact on the Bank’s financial performance last year and it continues to do so today.

Moving forward, the Bank has a clear strategy to increase assets in its current product and customer segments. We will continue to work closely with MAR to develop business opportunities, and benefit from operating and capital expenditure synergies. With a growing customer base and balance sheet, the Board believes that shareholders, customers and employees have good reason to be optimistic about Al Rayan Bank’s future.”

To ensure its growth is maintained, and strong profitability sustained, the Bank’s strategy for 2016 includes:

  • A continuing focus on the Bank’s product portfolio and high service standards. The introduction of additional products which meet customers’ needs and help keep the Bank competitive
  • A commitment to building excellent direct channels of interaction through the Bank’s website, mobile application and on-boarding systems for customers who wish to transact online
  • Developing and retaining employees and recruiting talented individuals who will support the Bank’s growth aspirations 
  • An emphasis on enhancing the end-to-end customer experience.

Sultan Choudhury, CEO, Al Rayan Bank said: “In 2015, Al Rayan Bank built a healthy balance sheet which has allowed us to leverage improving consumer confidence, the continued strength of the housing market and opportunities to provide finance to the SME sector. We have also grown our customer numbers, with new customers attracted by our strong ethical values, our competitive product range and our reputation for dedicated customer service. The Bank now serves over 60,000 retail, business and private banking customers. I believe that all of these factors, all made possible through the strong financial and strategic support of Masraf Al Rayan, have led to this outstanding financial performance.”

Al Rayan Bank has been a pioneer of British retail Islamic banking for 12 years. The first wholly Sharia compliant retail bank in the UK, it has earned a reputation for providing innovative products which appeal to people of any faith. Last year Al Rayan Bank was named by Global Finance magazine as one of the best Islamic banks in the world, in its annual list of the World’s Best Islamic Financial Institutions, and by Trade Finance Global as the Best Islamic Finance Services in Western Europe.

As an independent UK bank, Al Rayan Bank is authorised by the Prudential Regulation Authority, regulated by the Financial Conduct Authority and the Prudential Regulation Authority and is a member of Financial Services Compensation Scheme.

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