ADCB posts AED2.14 billion half-yearly profit

Dubai / Emirates Business

“With our resilient balance sheet and strong franchise, we remain focused on delivering sustainable growth and improving long-term financial performance and returns for shareholders. Our strategic pillars continue to define our business model and provide a clear direction for us. We are well positioned for the second half of 2016 and confident in our ability to benefit from future growth opportunities in the UAE.”
“We are also pleased to announce that global ratings agency Standard & Poor’s affirmed its rating on ADCB today at A/A-1 with a stable outlook, and the Bank’s stand-alone credit profile (SACP) was upgraded to ‘bbb+’ from ‘bbb’, driven by the Bank’s strengthening business position, track record of improving returns and balanced earnings across different business segments, a testament to the work we have been doing as a team over the years,” he added.
Ala’a Eraiqat, Member of the Board and Chief Executive Officer, commented on the results, “We are pleased with our financial results for the first half of the year. The Bank delivered a net profit of AED 2.147 billion and a return on equity of 17% for the first half of 2016. On a quarterly basis, the Bank reported a net profit of AED 1.126 billion for the second quarter of 2016, an increase of 10% over the previous quarter. Each of our businesses performed well, with consistent underlying growth. We delivered this growth despite the weaker operating environment, and ended first half 2016 with improved asset quality metrics, including a non-performing loan ratio of 2.7% and a provision coverage ratio of 133%.
“We remain prudent in our growth strategy and continue to focus on maintaining a diversified funding base while liquidity remains a top priority. Year-to- date we have made good progress in a number of areas. In a very competitive environment, we increased our low cost CASA deposits by 5%, grew our investment book by 18%, and as at 30 June 2016, we continued to be a net lender of over AED 20 billion in the interbank markets,” he added.
He further stated, “Our relentless focus on diversifying our revenues resulted in higher non-interest income contribution for the first half of the year, primarily driven by higher fees and commission income and higher trading income.
“Our ongoing bank-wide cost management initiatives helped us to maintain a cost to income ratio within our target range for the first half of 2016, while our cost to income ratio for Q2’16 improved to 31.1% from 34.9% in Q1’16. This improvement was achieved while we continued to invest in our businesses for the future, dedicating resources to technology, systems and controls.”
He concluded by saying, “Our quarterly financial performance is a reflection of our well executed strategic pillars agreed over the past years and demonstrates the strength of our franchise and businesses. Customer centricity and delivering long term value for shareholders remain the cornerstone of our strategy.”