Dubai Islamic Bank P J S C : 2023 Quarter 3 Report

Dubai Islamic Bank P.J.S.C.

Review report and condensed consolidated interim financial information

for the nine-month period ended 30 September 2023

Dubai Islamic Bank P.J.S.C.

Review report and condensed consolidated interim financial information (Unaudited) for the nine-monthperiod ended 30 September 2023

	Pages
Report on review of condensed consolidated interim financial information	1
Condensed consolidated interim statement of financial position	2
Condensed consolidated interim statement of profit or loss	3
Condensed consolidated interim statement of comprehensive income	4
Condensed consolidated interim statement of changes in equity	5
Condensed consolidated interim statement of cash flows	6 - 7
Notes to the condensed consolidated interim financial information	8 - 37

Deloitte & Touche (M.E.)

Building 2, Level 3

Emaar Square

Downtown Dubai

P.O. Box 4254

Dubai

United Arab Emirates

Tel: [phone]

Fax:[phone]

www.deloitte.com

REPORT ON REVIEW OF INTERIM FINANCIAL INFORMATION

The Board of Directors

Dubai Islamic Bank PJSC

Dubai

United Arab Emirates

Introduction

We have reviewed the condensed consolidated interim statement of financial position of Dubai Islamic Bank PJSC (the "Bank") and its subsidiaries (collectively referred as the "Group"), as at 30 September 2023, and the related condensed consolidated interim statements of profit or loss, comprehensive income, changes in equity and cash flows for the nine month period then ended. Management is responsible for the preparation and fair presentation of this interim financial information in accordance with International Accounting Standard 34: Interim Financial Reporting ("IAS 34"). Our responsibility is to express a conclusion on this interim financial information based on our review.

Scope of Review

We conducted our review in accordance with the International Standard on Review Engagements 2410 "Review of Interim Financial Information Performed by the Independent Auditor of the Entity". A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion

Based on our review, nothing has come to our attention that causes us to believe that the accompanying condensed consolidated interim financial information is not prepared, in all material respects in accordance with IAS 34.

Deloitte & Touche (M.E.)

Firas Anabtawi

Registration No.: 5482

31 October 2023

Dubai

United Arab Emirates

Akbar Ahmad (1141), Cynthia Corby (995), Faeza Sohawon (5508), Firas Anabtawi (5482), Georges Najem (809), Jazala Hamad (1267), Mohammad Jallad (1164), Mohammad Khamees Al Tah (717), Musa Ramahi (872), Mutasem M. Dajani (726), Obada Alkowatly (1056), Rama Padmanabha Acharya (701) and Samir Madbak (386) are registered practicing auditors with the UAE Ministry of Economy.

Dubai Islamic Bank P.J.S.C.

Condensed consolidated interim statement of profit or loss (Unaudited)

for the nine-month period ended 30 September 2023

			Three-month period		Nine-month period
			ended 30 September		ended 30 September
	Note	2023	2022	2023	2022
	AED'000	AED'000	AED'000	AED'000
NET INCOME
Income from Islamic financing and investing		4,501,418	3,112,478	12,512,973	8,103,872
transactions
Commissions, fees and foreign exchange income		385,456	330,183	1,292,265	1,235,989
Income from other investments measured at fair		317	253	30,614	43,522
value, net
Income from properties held for development and		77,915	39,338	194,156	100,090
sale, net
Income from investment properties		155,432	39,601	251,516	140,678
Share of profit from associates and joint ventures		38,790	28,614	111,218	86,286
Other income		79,197	56,727	155,276	162,240
		-----	-----	-----	-----
Total income		5,238,525	3,607,194	14,548,018	9,872,677
Less: depositors' and sukuk holders' share of profit		(2,271,186)	(993,792)	(6,000,774)	(2,219,813)
		-----	-----	-----	-----
Net income		2,967,339	2,613,402	8,547,244	7,652,864
		-----	-----	-----	-----
OPERATING EXPENSES
Personnel expenses		(461,908)	(401,946)	(1,269,698)	(1,181,374)
General and administrative expenses		(275,469)	(240,321)	(841,355)	(727,628)
Depreciation of investment properties		(16,227)	(14,355)	(45,774)	(42,281)
Depreciation of property and equipment		(37,147)	(28,498)	(104,775)	(89,092)
		-----	-----	-----	-----
Total operating expenses		(790,751)	(685,120)	(2,261,602)	(2,040,375)
		-----	-----	-----	-----
Net operating income before impairment charges		2,176,588	1,928,282	6,285,642	5,612,489
Impairment charges, net	19	(449,928)	(502,445)	(1,408,546)	(1,450,067)
		-----	-----	-----	-----
Net profit for the period before income tax expense		1,726,660	1,425,837	4,877,096	4,162,422
Income tax expense		(14,113)	(25,182)	(53,606)	(61,453)
		-----	-----	-----	-----
Net profit for the period		1,712,547	1,400,655	4,823,490	4,100,969
		=========	=========	=========	=========
Attributable to:
Owners of the Bank		1,647,628	1,376,701	4,696,802	4,045,789
Non-controlling interests		64,919	23,954	126,688	55,180
		-----	-----	-----	-----
Net profit for the period		1,712,547	1,400,655	4,823,490	4,100,969
		=========	=========	=========	=========
Basic and diluted earnings per share
(AED per share)	20	0.22	0.18	0.61	0.52
		=========	========	=========	=========

The notes on pages 8 to 37 form an integral part of these condensed consolidated interim financial information.

3

Dubai Islamic Bank P.J.S.C.

Condensed consolidated interim statement of comprehensive income (Unaudited)

for the nine-month period ended 30 September 2023

	Three-month period ended		Nine-month period ended
	30 September		30 September
	2023	2022	2023	2022
	AED'000	AED'000		AED'000	AED'000
Net profit for the period	1,712,547	1,400,655	4,823,490	4,100,969
	----	----		----	----
Other comprehensive income / (loss) items
Items that will not be reclassified subsequently to
profit or loss:
Fair value loss on other investments carried at
FVTOCI, net	(66,285)	(10,637)	(158,722)	(76,174)
Items that may be reclassified subsequently to profit
or loss:
Exchange differences on translation of foreign
operations, net	(10,205)	(67,573)	(153,183)	(216,848)
Fair value loss on sukuk investment carried at FVOCI	(2,659)	(6,619)	(20,818)	(30,353)
	----	----		----	----
Other comprehensive income / (loss) for the period	(79,149)	(84,829)	(332,723)	(323,375)
	----	----		----	----
Total comprehensive income for the period	1,633,398	1,315,826	4,490,767	3,777,594
	=======	=======	=======	=======
Attributable to:
Owners of the Bank	1,568,607	1,291,543	4,364,571	3,722,620
Non-controlling interests	64,791	24,283	126,196	54,974
	----	----		----	----
Total comprehensive income for the period	1,633,398	1,315,826	4,490,767	3,777,594
	=======	=======	=======	=======

The notes on pages 8 to 37 form an integral part of these condensed consolidated interim financial information.

4

Dubai Islamic Bank P.J.S.C.

Condensed consolidated interim statement of changes in equity (Unaudited)

for the nine-month period ended 30 September 2023

	------------------------	Equity attributable to owners and sukukholders of the Bank	----------------------------------
			Other
			reserves
			and	Investment	Exchange			Non-
	Share	Tier 1	treasury	fair value	translation	Retained		controlling	Total
	capital	sukuk	shares	reserve	reserve	earnings	Total	interests	equity
	AED'000	AED'000	AED'000	AED'000	AED'000	AED'000	AED'000	AED'000	AED'000
Balance at 1 January 2022	7,240,744	8,264,250	14,084,668	(972,955)	(1,313,911)	11,563,298	38,866,094	2,598,532	41,464,626
Net profit for the period	-	-	-	-	-	4,045,789	4,045,789	55,180	4,100,969
Other comprehensive loss for the period	-	-	-	(106,321)	(216,848)	-	(323,169)	(206)	(323,375)
	--------------------	--------------------	--------------------	--------------------	--------------------	--------------------	--------------------	--------------------	--------------------
Total comprehensive income / (loss) for the period	-	-	-	(106,321)	(216,848)	4,045,789	3,722,620	54,974	3,777,594
	--------------------	--------------------	--------------------	--------------------	--------------------	--------------------	--------------------	--------------------	--------------------
Transaction with owners directly in equity:
Dividend (note 26)	-	-	-	-	-	(1,806,778)	(1,806,778)	-	(1,806,778)
Zakat adjustment	-	-	-	-	-	375	375	-	375
Tier 1 sukuk profit distribution	-	-	-	-	-	(288,101)	(288,101)	-	(288,101)
Transfer on disposal of investments carried at FVTOCI	-	-	-	(1,041)	-	1,041	-	-	-
Regulatory credit risk reserve	-	-	120,000	-	-	(120,000)	-	-	-
Tier 1 sukuk issuance cost	-	-	-	-	-	(243)	(243)	-	(243)
Others	-	-	-	-	-	-	-	(584)	(584)
	--------------------	--------------------	--------------------	----------------------	----------------------	--------------------	---------------------	--------------------	---------------------
Balance at 30 September 2022	7,240,744	8,264,250	14,204,668	(1,080,317)	(1,530,759)	13,395,381	40,493,967	2,652,922	43,146,889
	=======	=======	========	========	========	=======	========	=======	========
Balance at 1 January 2023	7,240,744	8,264,250	14,654,668	(1,062,927)	(1,565,666)	13,772,643	41,303,712	2,671,256	43,974,968
Net profit for the period	-	-	-	-	-	4,696,802	4,696,802	126,688	4,823,490
Other comprehensive loss for the period	-	-	-	(179,048)	(153,183)	-	(332,231)	(492)	(332,723)
	--------------------	--------------------	--------------------	--------------------	--------------------	--------------------	--------------------	--------------------	--------------------
Total comprehensive income / (loss) for the period	-	-	-	(179,048)	(153,183)	4,696,802	4,364,571	126,196	4,490,767
	--------------------	--------------------	--------------------	--------------------	--------------------	--------------------	--------------------	--------------------	--------------------
Transaction with owners directly in equity:
Dividend (note 26)	-	-	-	-	-	(2,168,133)	(2,168,133)	-	(2,168,133)
Zakat adjustment	-	-	-	-	-	(1,677)	(1,677)	-	(1,677)
Tier 1 sukuk profit distribution	-	-	-	-	-	(288,101)	(288,101)	-	(288,101)
Transfer on disposal of investments carried at FVTOCI	-	-	-	(2,594)	-	2,594	-	-	-
Regulatory credit risk reserve	-	-	160,000	-	-	(160,000)	-	-	-
Others	-	-	-	-	-	1,443	1,443	(307)	1,136
	--------------------	--------------------	----------------------	----------------------	----------------------	----------------------	---------------------	--------------------	---------------------
Balance at 30 September 2023	7,240,744	8,264,250	14,814,668	(1,244,569)	(1,718,849)	15,855,571	43,211,815	2,797,145	46,008,960
	=======	=======	========	========	========	========	========	=======	========

The notes on pages 8 to 37 form an integral part of these condensed consolidated interim financial information.

5

Dubai Islamic Bank P.J.S.C.

Condensed consolidated interim statement of cash flows (Unaudited) for the nine-monthperiod ended 30 September 2023

		Nine-month period
		ended 30 September
	2023	2022
		AED'000	AED'000
Operating activities
Profit for the period before income tax expense	4,877,096	4,162,422
Adjustments for:
Share of profit from associates and joint ventures	(111,218)	(86,286)
Income from properties held for sale	(194,156)	(100,090)
Dividend income	(30,614)	(43,522)
Gain on sale of investments in Sukuks	(367)	(9,161)
Gain on disposal of investment properties	(159,908)	(55,753)
Depreciation of property and equipment	104,775	89,092
Loss on disposal of property and equipment	(15)	4,437
Depreciation of investment properties	45,774	42,281
Provision for employees' end-of-services benefit	4,265	25,123
Amortization of sukuk discount	127	2,389
Impairment charge for the period, net	1,408,546	1,450,067
Amortization of intangible assets	50,847	50,847
	----------------------	----------------------
Operating cash flow before changes in operating assets and liabilities	5,995,152	5,531,846
Increase in deposits and international murabahas with over three months maturity	-	(146,920)
Increase in Islamic financing and investing assets	(15,119,390)	(2,983,877)
Decrease / (increase) in receivables and other assets	491,180	(453,733)
Increase / (decrease) in customers' deposits	23,477,031	(18,036,096)
Increase in due to banks	155,674	6,201,825
Increase in payables and other liabilities	1,026,860	527,963
	----------------------	----------------------
Cash generated from / (used in) operations	16,026,507	(9,358,992)
Employees' end-of-services benefit paid	(13,809)	(19,953)
Tax paid	(96,639)	(52,180)
	----------------------	----------------------
Net cash generated from / (used in) operating activities	15,916,059	(9,431,125)
Investing activities	----------------------	----------------------
Net movement in investments in Sukuk measured at amortised cost	(14,422,662)	(7,522,500)
Additions to investment properties	(93,982)	(76,057)
Purchase of property and equipment, net	(166,811)	(223,177)
Purchase of properties held for development and sale	(214,100)	(276,486)
Proceeds from disposal of properties held for development and sale	727,901	402,404
Proceeds from disposal of investment properties	140,805	434,487
Net movement in other investments measured at fair value	3,539	48,010
Dividend received	30,614	43,522
Net movement in investments in associates and joint ventures	7,350	33,148
	----------------------	----------------------
Net cash used in investing activities	(13,987,346)	(7,136,649)
	----------------------	-----

The notes on pages 8 to 37 form an integral part of these condensed consolidated interim financial information.

6

Dubai Islamic Bank P.J.S.C.

Condensed consolidated interim statement of cash flows (Unaudited) for the nine-monthperiod ended 30 September 2023

	Nine-month period
	ended 30 September
	2023	2022
	AED'000	AED'000
Financing activities
Issuance of sukuk financing instrument	3,673,000	2,754,750
Repayment of sukuk financing instruments	(5,509,202)	(3,673,000)
Tier 1 sukuk profit distribution	(288,101)	(288,101)
Tier 1 sukuk issuance cost	(163)	(243)
Dividend paid	(2,168,133)	(1,806,778)
	----------------------	----------------------
Net cash used in financing activities	(4,292,599)	(3,013,372)
	----------------------	----------------------
Net decrease in cash and cash equivalents	(2,363,886)	(19,581,146)
Cash and cash equivalents at the beginning of the period	27,014,449	30,420,446
Effect of exchange rate changes on the balance of cash held in foreign currencies	(130,668)	124,671
	----------------------	----------------------
Cash and cash equivalents at the end of the period (note 21)	24,519,895	10,963,971
	=========	=========

The notes on pages 8 to 37 form an integral part of these condensed consolidated interim financial information.

7

Dubai Islamic Bank P.J.S.C.

Notes to the condensed consolidated interim financial information

for the nine-month period ended 30 September 2023

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 which is replaced by the UAE Federal Law No. 32 of 2021 on Commercial Companies (the "New Companies Law").

These condensed consolidated interim financial information combine the activities of the Bank and its subsidiaries as disclosed in Note 28 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 in accordance with Islamic Sharia principles under the guidance of Internal Sharia Committee ("ISC") and Higher Sharia Authority of Central Bank of UAE ("HSA") and carries out its operations through its local branches and overseas subsidiaries. The principal activities of the Group entities are described in note 28(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 ("IFRS")

2.1 New and revised IFRS applied with no material effect on the condensed consolidated financial statements

The following new and revised IFRS, which became effective for annual periods beginning on or after 1 January 2023, have been adopted in these financial statements. The application of these revised IFRS has not had any material impact on the amounts reported for the current and prior years but may affect the accounting for future transactions or arrangements.

• Amendments to IAS 8 Accounting policies, Changes in accounting estimates and errors;
• Amendments to IAS 1 Presentation of Financial Statements relating to classification of Liabilities as Current or Non-Current; and
• Amendment to IFRS 17 Insurance contracts.

2.2 New and revised IFRSs 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. The management is in the process of assessing the impact of the new requirements.

	Effective for
	annual periods
New and revised IFRS	beginning on or after
Amendment to IFRS 10 Consolidated Financial Statements and IAS 28 Investments in	Effective date
Associates and Joint Ventures relating to treatment of sale or contribution of assets from	deferred
investors	indefinitely.

Management anticipates that these new standards, interpretations and amendments will be adopted in the Group's financial statements for the period of initial application and adoption of these new standards, interpretations and amendments may have no material impact on the financial statements of the Bank in the period of initial application.

8