Business | Banking

NBAD profit increases 40% in third quarter

Lender sets aside Dh284 million in provisions

  • By Ahmed A. Namatalla, Staff Reporter, Gulf News
  • Published: 00:00 October 28, 2009
  • Gulf News

Abu Dhabi: National Bank of Abu Dhabi (NBAD) on Tuesday reported a profit of Dh914 million in the third quarter, a 40 per cent rise over last year.

The bank achieved the results despite setting aside another Dh284 million last quarter in provisions.

Profit in the first nine months reached Dh2.6 billion compared with Dh2.5 billion in the same period last year.

Operating income reached Dh1.7 billion for the third quarter and Dh4.8 billion for the year through the end of September, 41 per cent and 21 per cent increases over last year's figures, respectively.

The results were largely in line with analysts' expectations. Investment bank Al Futtaim HC had pencilled Dh927 billion.

Looking good

"Their margins look good," said Al Futtaim HC Banking Analyst Janany Vamadeva. "Their provisioning was a little higher than we expected, but it's manageable. Asset quality is not a problem when it comes to NBAD."

According to an NBAD statement, total provisioning reached Dh2.6 billion while non-performing loans totalled Dh1.5 billion at the end of September, representing 1.2 per cent of the bank's loan portfolio.

"For the first time this year we are ahead of historic 2008 earnings comparables," NBAD chief executive officer Michael Tomalin said in the statement.

"Nevertheless, we have again, in this quarter, been able to make substantial voluntary collective provisions to put us in a strong position to face any credit challenges ahead.

The bank's assets surpassed $50 billion (Dh184 billion) for the first time, reaching Dh186 billion at the end of September.

Loans grew 14.7 per cent this year to Dh128.2 billion, while deposits grew by 6.8 per cent to 110.5 billion.

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