Emirates NBD reported a doubling of third-quarter net profit yesterday, beating estimates as lower provisions and higher income bolstered earnings at Dubai’s largest bank.
The lender, 55.6% owned by state fund Investment Corp of Dubai, made a net profit of 1.56bn dirhams ($424.7mn) in the three months to September 30, a statement from the bank said, compared to 775mn dirhams in the same period last year.
The figure well exceeded the average forecast of five analysts polled by Reuters, who expected the bank to make a net profit of 1.16bn dirhams.
ENBD’s earnings have been given a lift in recent quarters by a resurgence in the Dubai economy, which has been boosted by a strengthening property market and a scaling down of debt troubles after a severe financial crisis.
In the third quarter, impairment allowances worth 1.22bn dirhams were allocated, down from the 1.52bn dirhams recorded in the same period of 2013.
Much of the bank’s provisioning in recent quarters has been towards boosting the bank’s bad loans coverage ratios, which improved to 70.3% at end-September, up from 54.8% at the same point of 2013.
Meanwhile non-interest income—revenue earned from fees and commissions—jumped 55% year-on-year in the third quarter to 1.38bn dirhams. Net interest income also grew by 9% over the same timeframe to 2.47bn dirhams.
“It is very pleasing that each part of the business was able to deliver year-on-year revenue growth,” said group chief executive Shayne Nelson in the statement.
Dubai Islamic Bank
Dubai Islamic Bank posted a 55.7% rise in third-quarter net profit, helped by a jump in income from Islamic financing as well as fees, commissions and foreign exchange.
But the bank, the UAE’s largest Shariah-compliant lender, will need to bolster its capital reserves to sustain the pace, chief executive Adnan Chilwan said yesterday, as the local economy booms and lending increases.
DIB, like other banks in the UAE, has posted significant earnings growth in recent quarters due to the UAE’s recovering economy, which is expected to grow by 4.4% in 2014.
DIB said lending had risen 27% since the start of the year, absorbing its capital buffers.
“If you want to sustain the growth momentum, in order not to limit growth, we will have to enhance the capital at the right time,” Chilwan told a third-quarter results webcast.
Chilwan said there were a number of options available to boost the bank’s capital reserves and it would choose the cheapest when the time came for it to act. He declined to give further details.
Deyaar
Dubai’s Deyaar Development reported a 94% rise in third-quarter net profit yesterday as sales at a newly-launched residential project boosted earnings.
Deyaar, one of the companies worst hit by Dubai’s property market collapse in 2009-2010, made a quarterly profit of 78.5mn dirhams ($21.37mn) in the three months to September 30, up from 40.5mn dirhams in the corresponding period of 2013.
An analyst at SICO Bahrain forecast Deyaar’s quarterly profit would be 49.6mn dirhams.
The Dubai developer said it concluded sales of residential units at tower-1 of its Montrose project, with the majority of units sold in third quarter.
National Commercial Bank
National Commercial Bank (NCB), Saudi Arabia’s largest lender by assets, posted a 7.8% increase in third-quarter net income, it said in a statement yesterday. NCB, which is currently undertaking the largest ever initial public offering in the Gulf Arab region, made 1.87bn riyals ($498.4mn) in the three months to September 30, up from 1.73bn riyals in the same period last year.
The bank began a two-week subscription period on Sunday for its 22.5bn riyals ($6.0bn) share sale. It has also said it would convert into a fully-fledged Islamic bank in around five years, after coming under pressure from Shariah scholars in the kingdom.
ADCB
Abu Dhabi Commercial Bank met analyst expectations as it reported a 16.4% increase in third-quarter net profit yesterday, with a big reduction in impairment allowances helping to boost earnings.
The fourth-largest lender in the UAE by assets made a net profit attributable to equity holders of 1.02bn dirhams ($277.7mn) in the three months to September 30, compared to 874.2mn dirhams in the corresponding period of last year, it said in a bourse filing.
The figure was in line with the forecast of six analysts polled by Reuters, with their average expectation for net profit in the period of 1.04bn dirhams.
The third-quarter profit increase was mainly down to a 35% year-on-year drop in impairments, which declined to 201mn dirhams.
Banks in the UAE have been setting aside less cash to cover bad loans in recent quarters as the country recovers strongly from a local real estate crisis and debt problems at Dubai state-linked entities at the turn of the decade, which forced lenders to ramp up provisioning levels.
Year-on-year growth in third-quarter net interest income and non-interest income was modest, at 2% and 3% respectively.
Emirates NBD reported a doubling of third-quarter net profit yesterday, beating estimates as lower provisions and higher income bolstered earnings at Dubai’s largest bank.
The lender, 55.6% owned by state fund Investment Corp of Dubai, made a net profit of 1.56bn dirhams ($424.7mn) in the three months to September 30, a statement from the bank said, compared to 775mn dirhams in the same period last year.
The figure well exceeded the average forecast of five analysts polled by Reuters, who expected the bank to make a net profit of 1.16bn dirhams.
ENBD’s earnings have been given a lift in recent quarters by a resurgence in the Dubai economy, which has been boosted by a strengthening property market and a scaling down of debt troubles after a severe financial crisis.
In the third quarter, impairment allowances worth 1.22bn dirhams were allocated, down from the 1.52bn dirhams recorded in the same period of 2013.
Much of the bank’s provisioning in recent quarters has been towards boosting the bank’s bad loans coverage ratios, which improved to 70.3% at end-September, up from 54.8% at the same point of 2013.
Meanwhile non-interest income—revenue earned from fees and commissions—jumped 55% year-on-year in the third quarter to 1.38bn dirhams. Net interest income also grew by 9% over the same timeframe to 2.47bn dirhams.
“It is very pleasing that each part of the business was able to deliver year-on-year revenue growth,” said group chief executive Shayne Nelson in the statement.
Dubai Islamic Bank
Dubai Islamic Bank posted a 55.7% rise in third-quarter net profit, helped by a jump in income from Islamic financing as well as fees, commissions and foreign exchange.
But the bank, the UAE’s largest Shariah-compliant lender, will need to bolster its capital reserves to sustain the pace, chief executive Adnan Chilwan said yesterday, as the local economy booms and lending increases.
DIB, like other banks in the UAE, has posted significant earnings growth in recent quarters due to the UAE’s recovering economy, which is expected to grow by 4.4% in 2014.
DIB said lending had risen 27% since the start of the year, absorbing its capital buffers.
“If you want to sustain the growth momentum, in order not to limit growth, we will have to enhance the capital at the right time,” Chilwan told a third-quarter results webcast.
Chilwan said there were a number of options available to boost the bank’s capital reserves and it would choose the cheapest when the time came for it to act. He declined to give further details.
Deyaar
Dubai’s Deyaar Development reported a 94% rise in third-quarter net profit yesterday as sales at a newly-launched residential project boosted earnings.
Deyaar, one of the companies worst hit by Dubai’s property market collapse in 2009-2010, made a quarterly profit of 78.5mn dirhams ($21.37mn) in the three months to September 30, up from 40.5mn dirhams in the corresponding period of 2013.
An analyst at SICO Bahrain forecast Deyaar’s quarterly profit would be 49.6mn dirhams.
The Dubai developer said it concluded sales of residential units at tower-1 of its Montrose project, with the majority of units sold in third quarter.
National Commercial Bank
National Commercial Bank (NCB), Saudi Arabia’s largest lender by assets, posted a 7.8% increase in third-quarter net income, it said in a statement yesterday. NCB, which is currently undertaking the largest ever initial public offering in the Gulf Arab region, made 1.87bn riyals ($498.4mn) in the three months to September 30, up from 1.73bn riyals in the same period last year.
The bank began a two-week subscription period on Sunday for its 22.5bn riyals ($6.0bn) share sale. It has also said it would convert into a fully-fledged Islamic bank in around five years, after coming under pressure from Shariah scholars in the kingdom.
ADCB
Abu Dhabi Commercial Bank met analyst expectations as it reported a 16.4% increase in third-quarter net profit yesterday, with a big reduction in impairment allowances helping to boost earnings.
The fourth-largest lender in the UAE by assets made a net profit attributable to equity holders of 1.02bn dirhams ($277.7mn) in the three months to September 30, compared to 874.2mn dirhams in the corresponding period of last year, it said in a bourse filing.
The figure was in line with the forecast of six analysts polled by Reuters, with their average expectation for net profit in the period of 1.04bn dirhams.
The third-quarter profit increase was mainly down to a 35% year-on-year drop in impairments, which declined to 201mn dirhams.
Banks in the UAE have been setting aside less cash to cover bad loans in recent quarters as the country recovers strongly from a local real estate crisis and debt problems at Dubai state-linked entities at the turn of the decade, which forced lenders to ramp up provisioning levels.
Year-on-year growth in third-quarter net interest income and non-interest income was modest, at 2% and 3% respectively.
