Dubai: Abu Dhabi Islamic Bank (ADIB) Group on Sunday reported a net profit of Dh450.8 million for the first quarter of 2015, up 10.1 per cent from a year earlier.
Total assets increased by 9.8 per cent to Dh114.1 billion year on year. The Group’s deposits were up 13.8 per cent to Dh87.6 billion at the close of the quarter as net customer financing assets grew 13.3 per cent to Dh72.3 billion compared to March 31, 2014.
The bank said its customers increased by 33.5 per cent in the same period. ADIB now serves almost 800,000 customers.
“Our continued growth is balanced by investment in our extensive UAE retail network and leading digital platforms, and the requirement to maintain a strong capital base. Following the acquisition of Barclays’ retail assets in the UAE we continue to expand into the expatriate retail segment while remaining a strong focus on our UAE customer base,” said Tirad Al Mahmoud, Chief Executive Officer at ADIB.
ADIB’s net revenue increased by 14.1 per cent to Dh1.2 billion in the first quarter of this year. Bank’s cost-to-income ratio declined to 46.6 per cent in the first quarter, from a peak of 53.2 per cent in the fourth quarter of 2014. Fee income increased by 25.7 per cent year on year in the first quarter
The integration of the former Barclays’ UAE retail banking operation has started to deliver revenue and cost synergies and the bank expects to see the overall benefit by first quarter of 2016.
Total non-performing accounts fell to 4.2 per cent of gross customer financing as at the close of the first quarter 2015 from 7.6 per cent a year earlier. Credit provisions and impairments for the first quarter decreased by 6.4 per cent year-on-year.
Equity and capital resources were Dh18.7 billion as of 31 March 2015, an increase of 8.1 per cent year on year. ADIB’s capital adequacy ratio under Basel II principles were reduced to 14.74 per cent at the end of the first quarter from 15.71 per cent a year earlier.
Although these ratios remain comfortably higher than the UAE Central Bank’s prescribed minimums of 12 per cent for capital adequacy and 8 per cent for tier 1 capital, ADIB intends to further enhance its capital across all classes, including common equity, to levels that support its future growth strategy and to fully meet Basel III requirements when they are introduced in the UAE.
“As ADIB continues on its strong and stable growth trajectory, underpinned by conservative risk management practices, it’s important for the bank to maintain high levels of capital as new regulatory requirements are introduced,” said Al Mahmoud.
The bank remains highly liquid with the advances to stable funds ratio of 82.2 per cent at the end of the first quarter of 2015 compared to 79.6 per cent in the same period last year. Customer financing to deposits ratio was at 82.6 per cent at March 31, 2015 compared to 82.9 per cent at first quarter end 2014.
