Dubai: In the first of the UAE banking sector results for first nine months, Dubai's Emirates NBD hit record profits of Dh19 billion, with the group 'strategically positioned to benefit from regional growth and consumer confidence'. The Dh19 billion total represents a 9% gain year-on-year.
The bank provided more than Dh100 billion in new loans during the period, helping deliver income gains of 7% in the third quarter of 2024. Apart from loan growth, Emirates NBD cited 'improving margins and higher fee & commission income'. The demand for loans also signals that UAE banks are well-placed to cope with further US Fed interest rate cuts and mirrored in the UAE.
Emirates NBD Group’s assets under management went past $40 billion, helped immensely by the digital wealth platform. The latter’s coverage was expanded to include fractional bonds and sukuks, equities and mutual funds.
Emirates Islamic Bank too delivered best ever results with an ‘excellent’ Dh2.5 billion profit. In Saudi Arabia, Emirates NBD’s branch expansion helped the loan book there to grow by 49%.
The impairment charges - a key measure on banks' showing - dropped from a year ago position. (On DFM, the stock is lower by nearly 2% at Dh19.9 after one hour of trade.)
"All business units achieved an outstanding performance with record retail lending, a one-third market share of UAE credit card spend and corporate lending originating Dh70 billion of gross new loans,” said Shayne Nelson, Group CEO.
The net interest margin remains rock solid at 3.75%, while overall income for the first nine months weighed in at Dh32.9 billion, a slight 0.5% gain. (Part of the net interest margin showing was provided by Emirates NBD's Turkey subsidiary DenizBank. Emirates NBD also has a significant presence in Egypt apart from Saudi Arabia.)
Impairment credit after 2023's impairment charge
Another plus for Emirates NBD will be on the impairment 'credit' side, which totaled Dh1.3 billion compared to the Dh1.5 billion charge it took last year. The 'cost of risk starting to normalise in Q3-24', according to the bank.
“Fee and commission income continues to grow strongly, benefiting from the investment in digital, product enhancements and straight through processing," said Patrick Sullivan, Group CFO.
Improved outlook for Egypt, Turkey
On prospects for 2025, Emirates NBD states: "Higher oil production in 2025 will provide a further anchor of support to both economies (UAE and Saudi Arabia). Egypt’s economic outlook continues to improve following earlier support from the UAE and international partners while Turkey’s monetary policy continues to successfully curb inflation.
"Regional geopolitics have not had a noticeable impact on the performance of the markets within Emirates NBD’s footprint but we are attentive to the potential risks."
