Abu Dhabi Commercial Bank Q2 profit rises 26% to record Dh3.83 billion

Dubai: Abu Dhabi Commercial Bank reported a record second-quarter profit before tax of Dh3.83 billion, up 26% from a year earlier, as lending grew and higher fee and trading income broadened its revenue base.

The result marked ADCB’s 20th consecutive quarter of profit growth, the bank said on Thursday. Profit before tax for the first half of 2026 rose 28% year on year to a record Dh7.61 billion.

First-half net profit after tax increased 34% to Dh6.74 billion. The comparison was not on a like-for-like basis because ADCB applied different tax rates in the two periods.

Its tax provision for the first half of 2025 was calculated at 15%, reflecting the introduction of the UAE Domestic Minimum Top-up Tax. The group subsequently determined that it qualified for an initial international activity exclusion and applied the 9% statutory tax rate in the first half of 2026.

“ADCB’s performance in the second quarter reflects the strength of our franchise and the resilience of the UAE economy, which demonstrated remarkable momentum especially in the context of regional developments during the period,” said Ala’a Eraiqat, ADCB’s group chief executive officer.

“Profit before tax increased 26% year on year to a record Dh3.826 billion, marking our 20th consecutive quarter of growth.”

ADCB’s net loans to customers rose by Dh42 billion during the first half to Dh445 billion. This represented growth of 10% since the end of 2025 and 18% from a year earlier.

Customer deposits increased by Dh27 billion during the six months to Dh527 billion, up 5% year to date and 14% annually. Total assets reached Dh833 billion, representing growth of 8% since December and 16% year on year.

Eraiqat said the bank had seen evidence of investment activity and consumer confidence across the UAE economy. He said ADCB had a healthy pipeline of opportunities across its core businesses, supported by investment in energy, transport, logistics, infrastructure, tourism and artificial intelligence.

Operating income increased 12% annually to Dh11.98 billion in the first half. Non-interest income climbed 22% to Dh4.51 billion and accounted for 38% of operating income.

Second-quarter non-interest income rose 12% from the same period last year, supported by higher fee and trading income.

“Non-interest income continues to serve as a key driver of growth, increasing 22% year on year in the first half, supported by higher fee and trading income,” said Deepak Khullar, ADCB’s group chief financial officer.

“Consistent growth in operating income combined with continued productivity initiatives and disciplined cost management drove a 90 basis point improvement in the first-half cost-to-income ratio to 26.8%.”

The bank’s cost of risk — a measure of expected loan losses relative to its lending portfolio — fell to 36 basis points in the second quarter from 88 basis points a year earlier.

For the first half, the cost of risk declined to 38 basis points from 69 basis points in the corresponding period of 2025. ADCB said this remained below its guidance.

The non-performing loan ratio improved to 1.71% at the end of June from 1.83% at the end of 2025.

Return on average equity after tax rose by 210 basis points year on year to 16.2%. The common equity tier-one ratio, a key measure of a bank’s ability to absorb losses, stood at 13.66%, compared with 13.79% at the end of December.

ADCB’s liquidity coverage ratio was 109.5%, down from 131.3% at the end of 2025. The ratio measures whether a bank holds enough high-quality liquid assets to meet short-term cash outflows during a period of financial stress.

The bank said it continued to implement its artificial intelligence strategy during the second quarter, integrating the technology across customer services, employee productivity and business operations. This included the launch of an AI-enabled mobile banking application.

ADCB is now in the second year of a five-year strategy focused on growth, technology and productivity. The bank said its capital and liquidity levels would support further lending and investment during the second half of 2026.