Text size:

  • Small
  • Normal
  • Large

Egyptian bank records yet another poor year

What's Down: Losses widened last year for National Development Bank, the Egyptian subsidiary of Abu Dhabi Islamic Bank, as a result of the country's revolution.

Losses widened last year for National Development Bank, the Egyptian subsidiary of Abu Dhabi Islamic Bank, as a result of the country's revolution.

Net losses at the unit, which is based in Cairo, increased to 590.6 million Egyptian pounds. The lender posted a loss of 501.2m pounds in 2010.

Shares in the bank declined 1.9 per cent to 4.25 pounds on the Egyptian Exchange yesterday. The lender's shares lost 42.5 per cent of their value last year.

Egyptian banks were hurt by the uprising that toppled Hosni Mubarak from the presidency last year, when political turmoil and industrial strikes prompted the central bank to close banks for nearly two weeks. The stock exchange was closed for two months as foreign investors withdrew from Egyptian companies.

Expenses at National Development Bank rose to 75m pounds last year, 36m pounds of which was provisioning for a rise in wages, from 69m pounds in 2010.

National Development is one of Egypt's smaller banks and has been in negative territory for at least five years.

The bank's shareholders voted last year for the lender to continue operations after it shed more than half its capital in 2010.

Abu Dhabi Islamic Bank inherited 5 billion Egyptian pounds of bad loans when it bought National Development Bank in 2007 as part of Egypt's privatisation programme.

National Development Bank, previously a conventional bank, was transformed into a Sharia-compliant bank after the purchase by the Abu Dhabi lender.

"It took them a long time to adjust after the purchase," said an analyst, who spoke on condition of anonymity.

"National Development Bank, previously government-owned, was very poorly managed. Provisions continue to this day, and I would not be surprised if they need another capital increase in the near future."

The depreciation of Egypt's currency, with foreign reserves down to US$16.4bn in January from $18.1bn in December, the downgrading in economic outlook by major rating agencies, and the 50 per cent decline in value for Egypt's stock market had a direct impact on the country's economy, National Development Bank said.

 

halsayegh@thenational.ae

Back to the top

More articles


Editor's Picks

 The Greens, villas: Q1 no change. 3BR - Dh210-250,000. 4BR - Dh210-260,000. 5BR - Dh220-300,000. Q1 2013-Q1 2014 5% rise. Pawan Singh / The National

In pictures: Where Dubai rents have risen and fallen, Q1 2014

Find out how rental prices in the prime locations in Dubai have altered during the first three months of the year and the current rates you will pay according to data provided by Asteco.

 Above, the private pool of Ocean Heights' five-bedroom penthouse flat. Courtesy Christie’s International Real Estate

In pictures: Penthouse flat is height of Dubai luxury living

A five-bedroom penthouse in Ocean Heights in Dubai Marina is on sale for Dh25 million and comes with a private pool and an unparalleled view of Dubai.

 The cooling towers of the Temelin nuclear power plant near the Tyn nad Vltavou in Czech Republic. The country wants to continue expanding nuclear energy capacity despite cancelling a tender to build two new units. David W Cerny / Reuters

In pictures: Best business images for the week to April 17, 2014

Here are some of the best business images for the week to April 17, 2014.

 A sign points the way to an outdoor market popular with German visitors on the Polish side of the German-Polish border. Sean Gallup / Getty Images

In pictures: A decade since the European Union went east

May 1 will mark 10 years since the European Union expanded east, taking in countries like Poland, the Czech Republic and the Baltic states as new members. And though the border region between Germany and Poland is flourishing with trade and cultural exchange, the open border has also brought a sharp rise in crime.

 The Wind, Energy, Technology and Environment Exhibition takes place from April 14 to April 16. Above, the Dewa showroom during last year’s Wetex. Jaime Puebla / The National

April corporate and economic calendar for the UAE and overseas

From Cityscape to Wetex to stock-market holidays to nations reporting first-quarter GDP figures, here is our helpful calendar of April's business events in the UAE and internationally.

 Get the latest information on credit cards, bank accounts and loan products in the UAE. Mark Lennihan / AP Photo

Rates report: Latest on UAE loans, accounts and credit cards

Souqamal.com brings you the latest interest rates on banking products in the UAE.

Events

To add your event to The National listings, click here

Get the most from The National