Lender reports “record” net profit of Dh2.39bn, says poised for growth across GCC
Dubai’s Emirates NBD reports 27% rise in first quarter net profit
Emirates NBD, Dubai’s biggest lender, reported a 27 per cent rise in first quarter net profit attributed to loan growth and stronger margins.
Net income rose to a “record” Dh2.39 billion ($651 million) in the three months to March 31, compared with Dh1.87bn in the same period of 2017, the bank said in an emailed statement. The results beat five analyst estimates averaging Dh2.17bn, according to Bloomberg.
“Emirates NBD delivered a strong set of results…underpinned by higher net interest income on the back of loan growth and improving margins and a lower cost of risk,” said Shayne Nelson, group chief executive of Emirates NBD. “The group’s balance sheet remains strong with solid liquidity and capital ratios and a further strengthening in credit quality.”
The bank continues to expand its international presence with a new branch opening in Jeddah last month and two further branches set to open in Saudi Arabia, he added. Emirates NBD is also in talks to buy Turkey's DenizBank, the lender said in January.
Total income rose 13 per cent year-on-year to Dh4.1bn, due to loan growth and the positive impact of recent rate rises, the bank said. Its net interest margin widened by 17 basis points (bps) to 2.68 per cent from 2.51 per cent in the fourth quarter of 2017, also helped by rate rises, as well as stable funding costs.
Impairment charges dropped 31 per cent from the year earlier period to Dh440 million. Customer loans stood at Dh311.4bn, up 2 per cent from the end of 2017, and deposits at Dh331.9bn, up 2 per cent from the end of 2017.
Total assets were up 1 per cent quarter-on-quarter from the end of 2017, to Dh475.6bn, the bank said.
“The operating performance for the first quarter of 2018 was pleasing as we delivered a record quarterly net profit supported by growth in our core business,” said Surya Subramanian, the bank's chief financial officer.
“With CASA [the ratio of deposits in current and savings accounts] representing 57 per cent of deposits, our book is positioned to benefit from expected rate rises. The cost to income ratio, at 31.1 per cent, provides headroom to keep investing for future growth as we further enhance our digital and technology capabilities.”