Emirates NBD delivered a record profit of AED13.8 billion ($3.8 billion) in the first half of 2024, driven by increased lending across its regional network and substantial impaired loan recoveries.
Quarterly profit topped AED7 billion for the first time ever, helped by the strongest ever results from Emirates Islamic, improving margins in DenizBank and sizeable recoveries bolstered by a buoyant economy. Lending grew 6% in the first half of 2024 to surpass the half-a-trillion-dirham milestone on strong regional demand.
All business units achieved an outstanding performance, delivering record retail lending, a one-third market share of UAE credit card spend and growing Assets Under Management by an incredible 41% y-o-y.
Landmark deals
Corporate lending originated AED48 billion of gross new loans, securing landmark deals across the network as it leverages the Group’s regional presence. Retained earnings boosted capital ratios and the rock-solid balance sheet, coupled with a market leading banking infrastructure, makes Emirates NBD a regional powerhouse to drive future growth.
The bank’s total income rose to AED21.4 billion on strong loan growth across all business segments coupled with an excellent stable, low-cost funding mix. The bank exhibited strong loan growth with lending up 6% in H1-24, surpassing AED500 billion for the first time.
Deposit mix was a key strength growing AED39 billion in the first half, evenly split between Current & Savings Accounts and Fixed Deposits.
Net interest margin improved to 3.65% in the second quarter of 2024 as DenizBank NIMs increased on favourable loan pricing and stable funding costs. Impairment credit was AED2.2 billion on regularisation of loan payments as clients benefit from a buoyant economy with impaired loan ratio improving to 4.2%. Earnings per share was up significantly by 13% to 214 fils in the first half of 2024.
AUM growth
Assets Under Management grew by an impressive 41% y-o-y to $25 billion, reflecting ongoing success of our wealth management strategy. Emirates NBD Capital successfully advised on the AED1.38 billion Spinneys IPO.
AED500 million of competitive financing was allocated to SMEs to support 'Dubai International Growth Initiative', facilitating Dubai based SMEs’ global expansion. The bank’s Kingdom of Saudi Arabia branch network doubling to 18 in last year, driving 33% loan growth in H1-24. Moody’s improved the Outlook on Emirates NBD’s credit rating to ‘Positive’.
Looking to the future, Emirates NBD is transforming into a data-first, digital-focused and environmentally responsible regional powerhouse.
Shayne Nelson, Group Chief Executive Officer said: “Quarterly profit surpassed AED7 billion for the first time ever, helped by the strongest ever results from Emirates Islamic, improving margins in DenizBank and sizeable recoveries bolstered by a buoyant economy.
All business units
“All business units achieved an outstanding performance with record retail lending, a one-third market share of UAE credit card spend and Corporate lending originating AED48 billion of gross new loans as it leverages the Group’s regional presence. Retained earnings boosted capital ratios and the rock-solid balance sheet, coupled with a market leading banking infrastructure, makes Emirates NBD a regional powerhouse to drive future growth.”
Patrick Sullivan, Group Chief Financial Officer said: “Total income of AED21.4 billion on strong loan growth across all business segments coupled with an excellent stable, low-cost funding mix. The group’s net interest margin improved to 3.65% in the second quarter of 2024 as DenizBank NIMs increased on favourable loan pricing and stable funding costs.
“The credit environment remains healthy and clients continue to benefit from a buoyant economy with further regularisation of loan payments, leading to a net impairment credit of AED2.2 billion. Loan growth guidance was revised upwards on strong regional demand while cost of risk guidance was positively revised downwards on a healthy credit environment.
The group’s exceptional performance and strong balance sheet was recognised by Moody’s who improved Emirates NBD’s credit rating outlook to Positive.”
Business Performance
Retail Banking and Wealth Management (RBWM) had an excellent first half of the year with the highest ever revenue, strongest ever loan acquisition and a substantial growth in balance sheet. Lending increased by a record AED23 billion y-o-y, growing 21% to AED130 billion.
Deposits grew AED30 billion y-o-y with a healthy CASA to Deposits ratio of 75%. One-third market share of UAE Credit Card spend as card spend grew 15% y-o-y.
Income grew 12% y-o-y as RBWM delivered its highest ever half-yearly funded & non-funded income. AUMs grew by an incredible 41% y-o-y, reflecting ongoing success of our wealth management strategy.
Corporate and Institutional Banking achieved an excellent 64% increase in profit before tax, primarily on higher income and increased recoveries. Non-funded income grew 21% due to higher fee income on increased lending, a strong contribution from investment banking and improved cross-sell across Foreign Exchange, Derivatives and Trade Finance.
Corporate lending up 7% in the first half of 2024, driven by AED48 billion of new lending throughout the region, partly offset by Sovereign, Real Estate and other scheduled repayments. Continued CASA growth was backed by the group’s best-in-class digital escrow capabilities, including APIs and virtual accounts. The bank posted higher international revenues across locations on capitalisation of network opportunities.--TradeArabia News Service
