FAB profit rises in Q1 despite dent in client activity late in quarter from regional tensions

Dubai: First Abu Dhabi Bank reported a rise in first-quarter earnings, supported by lending growth and diversified income, even as regional tensions weighed on client activity toward the end of the period.

Operating income increased 6% year-on-year to Dh9.34 billion, while operating profit rose 5% to Dh7.22 billion. Net profit came in at Dh5.01 billion, with return on tangible equity at 17.8%.

Pressure from geopolitical developments became more visible late in the quarter.

“Our first-quarter performance demonstrates the underlying strengths of our diversified franchise, with consistent execution through a period of heightened regional tensions and market volatility,” said Lars Kramer, Group Chief Financial Officer.

He added that fee-based and trading income helped offset softer activity, “mitigating the impact of dampened client flows towards the end of the quarter.”

Only limited disruption

The bank said it maintained operations with “only limited disruption” despite the shifting environment, citing strong capital, liquidity, and established business continuity protocols.

The bank’s performance reflected steady business momentum across divisions, alongside continued balance sheet expansion. Total assets grew 6% year-to-date to Dh1.49 trillion, surpassing the $400 billion mark for the first time. Loans rose 8% to Dh668 billion, while customer deposits increased 4% to Dh871 billion.

Asset quality improved, with the non-performing loan ratio declining to 2.1%, while liquidity and capital ratios remained comfortably above regulatory thresholds.

Diversified income support

Revenue growth was driven in part by a 12% increase in net interest income to Dh5.61 billion, while non-interest income accounted for 40% of total revenue. Investment banking and markets contributed 35% of group revenue, supported by deal activity and client engagement.

Chief Executive Hana Al Rostamani said the results reflected “a more volatile backdrop towards the end of the quarter,” while highlighting the bank’s ability to deliver consistent returns across cycles.

She pointed to continued investment in technology and artificial intelligence, alongside strong credit ratings and regulatory support, as key factors underpinning resilience.

Across business segments, wholesale banking and investment banking recorded double-digit revenue growth, while retail and wealth operations expanded through deposit inflows and client acquisition. International operations accounted for nearly a quarter of total revenue, supported by lending growth across more than 20 markets.

The results underscore how Gulf lenders are navigating solid domestic demand alongside external geopolitical risks, with diversified income streams helping cushion volatility in client activity.