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UAE: FAB 9-month profit jumps 26% to Dh9.2 billion

A decline in impairment charges improves the profitability of UAE’s largest bank.

First Abu Dhabi Bank (FAB), the UAE’s largest bank, on Thursday announced Dh9.2 billion net profit for the first 9 months of 2021, up 26 per cent year-on-year as loans and advances grew and impairment charges dropped.

Group’s nine-month revenues totalled Dh16 billion, up 17 per cent year-on-year, driven by strong growth in non-interest income.

Impairment charges dropped 16 per cent to Dh1.9 billion, reflecting improving economic conditions, and adequate provision buffers while operating costs totalled Dh4.4 billion, up 15 per cent year-on-year.

The bank’s Q3 2021 net profit reached Dh3.9 billion, up 54 per cent year-on-year.

“New product propositions are being rolled out in key areas, capitalising on partnerships and technology to deliver superior solutions and service. We also continue to make progress against our international strategy. The integration of our operations in Egypt is on track to be completed during 2022, and we have recently received regulatory approval to establish our first branch in Shanghai, which will further expand our strategic footprint in Asia, enabling us to offer enhanced connectivity for our clients,” said Hana Al Rostamani, group CEO of FAB.

“With the UAE at the forefront of the post-pandemic recovery and as we enter the final quarter of 2021, I am optimistic about the opportunities that lie ahead, not only for us as a bank, but also as an engine to the nation’s ambitious vision for the next 50 years and beyond,” she said.

FAB’s total assets grew seven per cent to Dh983 billion while customer deposits increased 12 per cent to Dh606 billion. Loans and advances expanded to Dh404 billion, up four per cent year-to-date.

“Our investment banking business was a major contributor to the group’s earnings growth, on the back of exceptional trading performance, and sustained activity across a number of areas including debt capital markets, trade finance, advisory, and equity capital markets where FAB continues to showcase undisputed regional leadership. We are also seeing positive underlying trends in our corporate and commercial, consumer, and private banking businesses, with corporate and consumer confidence strengthening during the period,” said James Burdett, group chief financial officer at FAB.

He noted that the bank demonstrates balance sheet strength across all key ratios. “Asset quality metrics are stable, and liquidity coverage ratio was 124 per cent at the end of September. We also maintained a solid capital position comfortably above regulatory requirements with CET1 at 13.0 per cent, and our strong capital generation capacity enabling us to absorb the adverse impact of regulatory headwinds and the inclusion of Bank Audi Egypt during 2021,” said Burdett.