Emirates NBD, a leading bank in the region, delivered a record set of results with net profit up 29 per cent to Dh5 billion ($1.36 billion) for the first half of this year.

 

Net interest income improved 20 per cent year-on-year due to loan growth and a further improvement in margins. The operating performance was also supported by a 40 per cent improvement in provisions, the bank said.

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. 

 

Other financial highlights

* Net interest margin improved by 33 bps y-o-y to 2.78 per cent helped by rate rises;

* Total Income of Dh8.5 billion improved 13% y-o-y;

* Total assets at Dh477.5 billion, up 2% from end 2017;

* Customer loans at Dh316.4 billion, up 4% from end 2017;

* Customer deposits at Dh335.0 billion, up 3% from end 2017;

* Impaired loan ratio stable at 6.0% whilst coverage ratio strengthened to 128.4% ;

* Liquidity coverage ratio of 158.7% and AD ratio of 94.4% demonstrates healthy liquidity position; 

* Capital ratios strengthened with common equity tier 1 ratio improving to 16.3% and capital adequacy ratio at 21.2%

 

Hesham Abdulla Al Qassim, vice chairman and managing director, Emirates NBD, said: “I am extremely proud that Emirates NBD has delivered another record net profit in the first half of 2018. Following the recent UAE Innovation Month, I am pleased that, in its first year of operation, Liv., the lifestyle digital bank for millennials, has attracted over 100,000 customers. Liv. is now the fastest growing digital bank in the UAE and 84% of customers are new to the bank. 

 

“Emirates NBD was named ‘Best Bank in the Middle East’ as well as ‘Best Bank in the United Arab Emirates’ for the fourth consecutive year at the Euromoney Awards for Excellence. The bank was lauded for its commitment to the digitisation of banking services within the region, having introduced several first-to-market digital banking solutions. We have enthusiastically embraced the Year of Zayed to honour the legacy of our nation’s founding father, with numerous CSR activities,” he said.

 

Group chief executive officer Shayne Nelson said: “For the first time in the group’s history, Emirates NBD delivered a half-yearly net profit in excess of Dh5 billion underpinned by higher net interest income on the back of loan growth and improving margins and a lower cost of risk. 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. Following the bank’s announcement to enter into a definitive agreement to buy Sberbank’s 99.85 per cent stake in Denizbank AS, we were pleased that both Moody’s and Fitch affirmed the ratings and outlook of Emirates NBD.” 

 

Group chief financial officer Surya Subramanian said: “The operating performance for the second quarter of 2018 was pleasing as we delivered a record quarterly net profit supported by growth in our core business. Margins improved 14 bps during the quarter as rate rises flowed through to the loan book and more than offset a modest increase in deposit costs. With CASA representing 54 per cent of deposits, our book is positioned to benefit from further rate rises and, as a consequence, we have revised up margin guidance for this year. The cost to income ratio, at 31.3%, provides headroom to keep investing for future growth and further enhance our digital and technology capabilities.” – TradeArabia News Service