Business | Banking
First Gulf Bank expects UAE expansion to lift profit growth
First Gulf Bank said profit growth this year could accelerate as United Arab Emirates economic expansion generates more business. The lender ruled out foreign acquisition, preferring organic growth.
- Reuters
- Published: 01:00 April 11, 2008
Abu Dhabi: First Gulf Bank said profit growth this year could accelerate as United Arab Emirates economic expansion generates more business. The lender ruled out foreign acquisition, preferring organic growth.
Net income in the three months to March 31 surged 66 per cent to Dh675 million ($183.8 million), or Dh0.49 per share, the bank said on Wednesday, without giving comparative data for the year-earlier period.
"Sixty-six per cent is not a one-off and it is sustainable," chief executive officer Andre Sayegh said in an interview in Abu Dhabi yesterday.
Asked if the bank - Abu Dhabi's second-largest by market value - could post profit of Dh675 million in each quarter, Sayegh said: "Yes, we could post that kind of a profit ... the UAE economy is growing in all directions, and the major drivers are the projects in all sectors."
Steady growth
The bank posted a net income of Dh2 billion last year, an increase of 31 per cent compared with 2006, according to Reuters data. Profit of Dh675 million per quarter would imply net income this year of about Dh2.7 billion, or 35 per cent more than 2007.
"We expect to grow very strongly in the next quarters through the next two years," Sayegh said, declining to be more specific. "We are not looking at an acquisition or merger outside for the time being ... we are looking more at organic growth."
The bank, which has started operations in Libya and Singapore, plans to open offices in London, Shanghai, Doha and India this year, as well as a branch in Algeria in the next few months, Sayegh said.
It also plans to upgrade its Singapore office into a wholesale business unit "because there are lots of opportunities in Asia," Sayegh said.
"If a bank is doing well, there is no pressure for it to merge," Sayegh said. "Banks merge when market circumstances force them."
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