Emirates NBD’s 2021 net profit up 34% to Dh9.3 billion, reinforcing UAE's growth rebound
Strong performance supports 25% increase in proposed dividend to 50 fils
Dubai: Emirates NBD’s net profit jumped 34 per cent to Dh9.3 billion in 2021, demonstrating the resilience of the bank and the strong economic recovery of the UAE.
The group’s net profit of Dh2 billion for Q4-21 is 53 per cent up year on year. The board has recommended 25 per cent increase in proposed dividends to 50 fils. “Emirates NBD continued financing the real economy and was rewarded as economic growth rebounded,” said Sheikh Ahmed Bin Saeed Al Maktoum, Chairman, Emirates NBD.
Despite interest rates remaining at historically low levels, the underlying business momentum continues to strengthen with record demand for retail financing.
Solid on 2021 numbers
The Group’s balance-sheet strengthened with further improvements in deposit mix, core capital and liquidity while credit quality remained stable. Total income for Q4-21 was up 32 per cent year-on-year - and 13 per cent quarter-on-quarter - to Dh6.5 billion on higher non-funded income due to increased transaction activity, growth in foreign exchange and derivative income and a Dh300 million gain relating to the sale of Dubai Bank.
“The diversified balance-sheet and solid capital base remains a core strength of the group,” said Hesham Abdulla Al Hassam, Vice-Chairman and Managing Director. Net loans for the year declined 5 per cent year-on-year as record demand for retail financing was largely offset by the decline in corporate lending due to repayments and the FX translation impact from DenizBank.
Deposit mix improved in 2021 with Dh38 billion growth in CASA [current and savings account] replacing Dh33 billion of fixed deposits. Record CASA balances kept the cost of funding stable. Total income for 2021 was up 3 per cent to Dh23.8 billion as higher retail volumes offset the impact of low interest rates.
Expenses for 2021 were 2 per cent higher than the previous year as business activity recovers and investment continues in International, digital and advanced analytics.
“There are many positives in the group’s strong set of results. The rise in income despite low interest rates, coupled with an improvement in the cost of risk to pre-pandemic levels, helped deliver a Dh9.3 billion profit,” said Shayne Nelson, Group CEO.
Impairment allowances for 2021 were 26 per cent lower at Dh5.9 billion due to improving economic conditions and following proactive provisioning in 2020.