ADIB, ADCB profits surge amid expectations of better economic conditions
ADIB profit beats estimates, ADCB results in line with expectations
Abu Dhabi Islamic Bank (ADIB), the emirate’s biggest Sharia-compliant lender, and Abu Dhabi Commercial Bank said on Sunday that profits for the third quarter surged amid expectations of an improvement economic outlook.
ADIB’s net profit for the three months ended September 30 rose 10.8 per cent to Dh563.9 million from Dh508.9m a year earlier, beating an average estimate of Dh531.6m from three analysts polled by Bloomberg.
The lender’s revenue increased by 3.9 per cent to Dh1.42 billion from Dh1.36bn a year earlier, while its credit provisions and impairments fell 9.3 per cent to Dh242.7m from Dh267.7m.
“Notwithstanding the potential return of volatility in global financial markets and ongoing geopolitical concerns in multiple regions, we remain positive about the UAE’s economic outlook and will continue to invest in growing our market share in an increasing number of segments,” said Khamis Buharoon, ADIB’s vice chairman and acting chief executive.
“ADIB is well positioned to take advantage of opportunities that are expected to arise as the pace of economic diversification accelerates.”
Mashreq Q3 profits up 35% on lower impairments
Moody’s maintains stable outlook on UAE banking industry on back of ‘economic resilience’
ADCB’s third-quarter net profit rose 9 per cent to Dh1.09bn from Dh999m a year earlier, broadly in line with analysts’ expectations, as it boosted net interest and Islamic financing income.
Three analysts polled by Bloomberg had forecast an average net profit of Dh1.05bn.
Operating income rose 9 per cent to Dh2.24bn from Dh2.07bn a year earlier.
Total net interest and Islamic financing income rose 10 per cent to Dh1.67bn from Dh1.52bn, while non-interest income increased 5 per cent to Dh569m from Dh541m.
“ADCB is well positioned to benefit from the long-term growth prospects of the UAE economy,” said Ala’a Eraiqat, chief executive of ADCB. “Our strategy is efficient, our business model is strong and we remain committed to deliver value for all our stakeholders.”
ADCB’s non-performing loans rose 10.7 per cent to Dh5.09bn at the end of September, compared with Dh4.6bn at the end of December last year.
Mashreq, the Dubai lender, said last week it posted a 35 per cent jump in third-quarter net profit to Dh561m, boosted by gains in net interest income, fees and commissions and a drop in money set aside to cover bad debt.
Bank profitability is expected to improve with the economic recovery and higher credit growth. Moody’s Investors Service is forecasting credit growth of 5 per cent for the UAE banking sector in 2018. That compares to 2 per cent in 2017, 5.8 per cent in 2016 and 8 per cent in 2015.
Updated: October 22, 2017 08:49 PM