Abu Dhabi Commercial Bank posted a 90 per cent drop in third-quarter net profit, falling short of analysts' expectations, as the lender booked hefty provisions, sending its shares down over 8 per cent.

ADCB, the sixth largest bank in the UAE by market value, posted a net profit of Dh44 million ($11.98 million) in the third quarter versus Dh447.6 million in the year earlier period, according to a statement on the bourse's website on Tuesday.

"The bank continued to set aside provisions to cover any probable loss in its loan portfolio and some investments which had a negative impact on the bank's results for Q3," Eissa Al Suwaidi, chairman of ADCB, said in a statement.

The bank warned of "challenging" markets in the short term and said it booked provisions of Dh810 million against bad loans. Year-to-date provisions stood at Dh1.7 billion.

Analysts polled by Reuters earlier this month forecast an average third-quarter net profit of Dh274 million.

Shares tumbled on the news, shedding 8.3 per cent to close at Dh2.12, giving up gains made since September 8. The Abu Dhabi leading share index ended down 0.71 per cent.

Net interest income increased to Dh2.41 billion in the nine months, up 35 per cent over the same period last year, while operating income rose 9 per cent to Dh3.56 billion.

The bank's gross loans stood at Dh119.3 billion and deposits at Dh83.5 billion at end-September, with the loans-to-deposits ratio at 140 per cent.

Total assets stood at Dh158.6 billion, up 7 per cent from December 2008. – Reuters