Dubai: Emirates NBD on Tuesday reported a first quarter net profit of Dh1.8 billion up 8 per cent compared to the first quarter of 2015.
The healthy operating performance was helped by an increase in total income, driven by asset growth and stable core fee income, coupled with a control on expenses and lower provisions.
Despite challenging market conditions, Emirates NBD continued to achieve growth in revenue and net profit as various parts of the business delivered a robust performance in the first quarter, the bank said in a statement.
Total Income for the first quarter grew by 2 per cent to Dh3.9 billion. Net interest income grew 3 per cent to Dh2.6 billion as loan growth more than offset a contraction in margins. Non-interest income marginally declined by 1 per cent to Dh1.4 billion as core fee income held steady, bolstered by growth in credit card volumes, whilst income from property and investments declined due to lower one-off gains.
The Bank’s balance sheet remained strong in Q1-16. Credit quality improved as the Impaired Loan ratio advanced from 7.1 per cent to 6.9 per cent during the quarter whilst the Impaired Loan Coverage ratio also strengthened to 113.5 per ent.
“The balance sheet continues to remain strong, with further improvements in credit quality metrics coupled with steady funding and capital ratios. The Group is well positioned to utilise our strong franchise, capital and liquidity base to take advantage of opportunities within the region,” said Hesham Abdulla Al Qassim, Vice Chairman, Emirates NBD.
Bank’s advances to deposit ratio at 95.9 per cent remains comfortably within the management’s target range. During the quarter the bank issued Dh2 billion of term debt through private placements at competitive pricing which further boosted structural liquidity. Capital Ratios, at a healthy 20.3 per cent.
“We have delivered another robust set of financial results. This is driven by higher income from asset growth and lower provisions. Liquidity pressures in the sector continued to ease in the first quarter from the tight conditions experienced in the second half of 2015.
Wholesale Banking, Global Markets & Treasury and Retail Banking & Wealth Management units all delivered a solid first quarter. We remain cautiously optimistic for the remainder of 2016 but are conscious of the headwinds that a strong dollar and volatile oil price can present,” said Shayne Nelson, Group Chief Executive Officer, Emirates NBD.
