10 Segment information
Segment Information
For management purposes, the Group is organized into five major business segments:
(i) Commercial and retail financing, which principally provides loans and other credit facilities for institutional and individual customers.
(ii) Investment, which involves the management of the Group’s investment portfolio and its treasury activities.
(iii) Islamic financing and investing, which involves one of the Group’s subsidiaries providing investment, consumer and commercial financing and other related services based on Islamic Sharia’s rules and principles.
(iv) Insurance, which involves one of the Group’s subsidiaries providing non-life insurance services.
(v) Brokerage, which involves one of the Group’s subsidiaries providing brokerage services.
Information regarding the Group’s reportable segments is presented below:
These segments are the basis on which the Group reports its primary segment information. Transactions between segments are conducted at rates determined by management taking into consideration the cost of funds.
| 31 December 2020 |
Commercial and retail financing |
Investment |
Islamic financing and investing |
Brokerage | Insurance | Unallocated | Total | |||||||||
| AED’000 | AED’000 | AED’000 | AED’000 | AED’000 | AED’000 | AED’000 | ||||||||||
| Interest income and income from Islamic financing and investing assets | 182,177 | 5,198 | 6,478 | 13,260 | 2,893 | – | 210,006 | |||||||||
| Interest expense and profit distributable to depositors | (40,543) | (9,909) | (981) | (5,109) | – | – | (56,542) | |||||||||
| Net fee and commission income | 21,335 | – | 888 | 3,440 | – | – | 25,663 | |||||||||
| Net income from investment | – | 31,493 | – | – | – | – | 31,493 | |||||||||
| Net insurance premium earned | – | – | – | – | 145,694 | – | 145,694 | |||||||||
| Net commission paid | – | – | – | – | (14,089) | (14,089) | ||||||||||
| Net insurance claims incurred | – | – | – | – | (84,212) | – | (84,212) | |||||||||
| Other underwriting income | – | – | – | – | (4,867) | – | (4,867) | |||||||||
| Net insurance income | – | – | – | – | 42,526 | – | 42,526 | |||||||||
| Share of results of an associate | – | (307) | – | – | – | – | (307) | |||||||||
| Other operating income | 19,620 | 3 | 2,662 | 42 | 19 | – | 22,346 | |||||||||
| Total segment revenue |
182,589 |
|
26,478 |
|
9,047 |
|
11,633 |
|
45,438 |
|
– |
|
275,185 |
|||
| Depreciation of property, fixtures and equipment | – | (203) | (128) | (124) | (1,843) | (12,910) | (15,208) | |||||||||
| Other expenses and charges | (44,168) | (2,353) | (5,552) | (8,130) | (41,109) | (63,667) | (164,979) | |||||||||
| Total expenses and other charges | (44,168) | (2,556) | (5,680) | (8,254) | (42,952) | (76,577) | (180,187) | |||||||||
| Profit for the year before impairment |
138,421 |
|
23,922 |
|
3,367 |
|
3,379 |
|
2,486 |
|
(76,577) |
|
94,998 |
|||
| Net impairment charges on loans and advances | (72,273) | – | – | – | – | – | (72,273) | |||||||||
| Net impairment charges on Islamic financing and investing assets | – | – | (1,825) | – | – | – | (1,825) | |||||||||
| Net profit for the year |
66,148 |
|
23,922 |
|
1,542 |
|
3,379 |
|
2,486 |
|
(76,577) |
|
20,900 |
|||
| Segmental assets | 2,009,721 | 137,269 | 632,238 | 292,743 | 335,853 | – | 3,407,824 | |||||||||
| Segmental liabilities | 2,010,707 | 166,086 | 57,740 | 207,964 | 195,591 | – | 2,638,088 | |||||||||
| Additions to non-current assets during the year | – | 26 | – | 270 | 5,183 | 1,615 | 7,094 | |||||||||
Information regarding the Group’s reportable segments is presented below:
| 31 December 2019 |
Commercial and retail financing |
Investment | Islamic
financing and investing |
Brokerage | Insurance | Unallocated | Total | |||||||||
| AED’000 | AED’000 | AED’000 | AED’000 | AED’000 | AED’000 | AED’000 | ||||||||||
| Interest income and income from Islamic financing and investing assets | 210,117 | 23,701 | 14,927 | 7,874 | 3,340 | – | 259,959 | |||||||||
| Interest expense and profit distributable to depositors | (74,663) | (7,375) | (1,240) | (2,343) | – | – | (85,621) | |||||||||
| Net fee and commission income | 39,380 | – | 2,122 | 1,543 | – | – | 43,045 | |||||||||
| Net income from investment | – | 14,279 | – | – | – | – | 14,279 | |||||||||
| Net insurance premium earned | – | – | – | – | 147,139 | – | 147,139 | |||||||||
| Net commission paid | – | – | – | – | (11,698) | – | (11,698) | |||||||||
| Net insurance claims incurred | – | – | – | – | (84,411) | – | (84,411) | |||||||||
| Other underwriting income | – | – | – | – | (5,445) | – | (5,445) | |||||||||
| Net insurance income | – | – | – | – | 45,585 | – | 45,585 | |||||||||
| Share of results of an associate | – | (365) | – | – | – | – | (365) | |||||||||
| Other operating income | 18,575 | 38 | – | 842 | 1,572 | – | 21,027 | |||||||||
| Total segment revenue |
193,409 |
30,278 |
15,809 |
7,916 |
96,082 |
– |
343,494 |
|||||||||
| Depreciation of property, fixtures and equipment | – | (304) | (551) | (300) | (1,829) | (13,398) | (16,382) | |||||||||
| Other expenses and charges | (41,454) | (10,593) | (10,486) | (7,417) | (41,972) | (76,702) | (188,624) | |||||||||
| Total expenses and other charges | (41,454) | (10,897) | (11,037) | (7,717) | (43,801) | (90,100) | (205,006) | |||||||||
| Profit for the year before impairment |
151,955 |
19,381 |
4,772 |
199 |
6,696 |
(90,100) |
92,903 |
|||||||||
| Net impairment charges on loans and advances | (69,258) | – | – | – | – | – | (69,258) | |||||||||
| Net impairment charges on Islamic financing and investing assets | – | – | (1,200) | – | – | – | (1,200) | |||||||||
| Net profit for the year |
82,697 |
19,381 |
3,572 |
199 |
6,696 |
(90,100) |
22,445 |
|||||||||
| Segmental assets | 2,316,190 | 919,668 | 144,233 | 209,488 | 334,354 | – | 3,923,933 | |||||||||
| Segmental liabilities | 2,288,924 | 457,876 | 55,348 | 128,088 | 199,213 | – | 3,129,449 | |||||||||
| Additions to non-current assets during the year | – | 292 | 45 | 299 | 539 | 1,890 | 3,065 | |||||||||
