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Abu Dhabi, UAEThursday 15 November 2018

Emirates NBD Q2 profit rises 30% on lower provisions, higher interest income

Net impairment loss on financial assets fell 97 per cent to Dh314m during the quarter

Shayne Nelson, chief executive of Emirates NBD, said tje bank delivered a half-yearly net profit in excess of Dh5bn for the first time in its history. Victor Besa for The National
Shayne Nelson, chief executive of Emirates NBD, said tje bank delivered a half-yearly net profit in excess of Dh5bn for the first time in its history. Victor Besa for The National

Emirates NBD, Dubai's biggest bank, reported a 30 per cent rise in second-quarter net profit, beating analysts' forecasts, thanks to higher net interest income and lower provisions.

Net profit attributable to equity holders rose to Dh2.6 billion ($700 million) in the first three months of 2018, Emirates NBD said on Wednesday in a filing to the Dubai Financial Market, where its shares are traded.

The results beat the median forecast of Dh2.2bn, according to a Bloomberg poll of two analysts. Net impairment loss on financial assets fell 97 per cent to Dh314m from a year-earlier period.

“For the first time in the group’s history, Emirates NBD delivered a half-yearly net profit in excess of Dh5bn 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.

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“The bank’s balance sheet remains solid with a further strengthening in capital due to retained earnings, coupled with stable liquidity and credit quality ratios.”

Net interest income improved 20 per cent year-on-year on loan growth and helped by a continuing improvement in margins, which rose by 33 basis points year-on-year to 2.78 per cent, helped by rate rises, the bank said.

Total income rose 13 per cent year-on-year in the second quarter to Dh8.5bn, while customer loans were up 4 per cent to Dh316.4bn and customer deposits rose 3 per cent to Dh335bn. Total assets stood at Dh477.5bn, up 2 per cent from the end of 2017, the bank said.