Union de Banques Arabes & Francaises (UBAF) has announced a net consolidated profit of FF 48.4 million ($9.8 million) in 1994, following its annual general meeting on 29 May.

UBAF attributes last year's return to profitability to a stringent balance sheet policy, acting dynamically on traditional markets and managing to contain overhead expenses. These fell by two per cent in 1994, a UBAF statement released in advance of the publication of the bank's annual report said.

It is the bank's highest profit figure since 1988. UBAF reported a loss of FF 743 million ($150 million) in 1993, accompanied by a substantial capital increase of FF 502 million ($101 million - MEED 24:6:94).

UBAF boosted its provisions against country risk to a ratio of 66.4 per cent by the end of 1994.

This compares with an average ratio for French banks of 53.5 per cent at the end of 1993, the statement said. UBAF's capital adequacy ratio is now 15.5 per cent.

UBAF processed $4,300 million worth of documentary credits in 1994. About 60 per cent of which came through UBAF's Asian network.

UBAF branches in South Korea, Singapore and Japan enjoyed a market share of exports to the Arab region of 30 per cent, 18 per cent and eight per cent, respectively. UBAF's share of the market in French exports to the area, which stood at FF 68,000 million ($13,744 million) in 1994, was five per cent.

The bank says it is optimistic about future trade levels in the region and forecasts a one per cent increase in commercial flows to and from the area in the next three years. This provides an incentive to broaden its range of activities in Arab markets, UBAF says.

$1= FF 4.9473 (FT June 2)