Dubai: Abu Dhabi mega-bank FAB’s net profit for the first six months of 2022 totals a massive Dh8 billion – and that comes from a 50 per cent increase year-on-year.
“Despite heightened global market volatility, our core businesses maintained solid growth momentum reflecting healthy pipeline execution across our diversified franchise, and our ongoing strategic focus on deepening client relationships," said Hana Al Rostamani, Group CEO at FAB.
On lending, FAB’s exposure is at Dh459 billion (including Islamic financing), up by 6 per cent sequentially and 12 per cent on a year-to-date basis. Customer deposits were Dh648 billion at the end of June, while a Liquidity Coverage Ratio (LCR) of 135 per cent ‘underlines a strong position’. The NPL (Non-Performing Loan) ratio and provision coverage were at 3.6- and 100 per cent, respectively.
“Almost Dh50 billion (in) net incremental lending was extended by FAB year-to-date, which is a record for the Group for any half-year period,” the CEO added. “This demonstrates buoyant regional activity, FAB’s leading origination capabilities, and the fundamental strength of our balance-sheet as we continued to deploy our resources and expertise to support our client franchise with their local and cross-border banking needs.”
FAB’s profit was based around total income of Dh12.5 billion, a gain of 31 per cent from a year ago. The revenue spike also includes the Dh3.1 billion net gain from selling a majority stake in the payments processing firm Magnati.
Another major gain for FAB during the period was the 9 per cent lower impairment charges, which comes to Dh1 billion net.
In the second quarter alone, the net profit was at Dh2.9 billion, up 13 per cent sequentially.
During this period, “all our core businesses delivered top-line growth sequentially, led by a double-digit growth in investment banking and corporate and commercial Banking, which is a strong result in the context of adverse global market conditions.”
- James Burdett, Group CFO of FAB
“This was helped by strong volumes, early benefits from rising interest rates, and healthy client activity in global markets consistent with our strategy to enhance cross-sell. Risk was prudently managed across the Group, while the year-on-year growth in operating expenses reflects continued investments in franchise growth and transformation.”
FAB said that it is ‘optimally positioned’ to keep benefiting from interest rate hikes, the latest of which happened overnight. But there will be extreme caution given the increased global market volatility, ‘persistently elevated global inflation and rapidly evolving monetary policy’.