File photo: An Emirates NBD in the UAE. Image Credit: Pankaj Sharma, Gulf News

Dubai: Emirates NBD on Wednesday reported a net profit of Dh5 billion in the first half of 2018, up 29 per cent compared with the same period last year.

Net interest income improved 20 per cent year-on-year due to loan growth and a further improvement in margins. The operating performance was also supported by a 40 per cent improvement in provisions, according to a bank statement.

“For the first time in the group’s history, Emirates NBD delivered a half yearly net profit in excess of Dh5 billion underpinned by higher net interest income on the back of loan growth and improving margins and a lower cost of risk,” said Shayne Nelson, Group Chief Executive Officer of Emirates NBD.

The bank’s balance sheet remains solid with a further strengthening in capital due to retained earnings, coupled with stable liquidity and credit quality ratios.

Total income for the half of 2018 amounted to Dh8.45 billion; an increase of 13 per cent compared with Dh7,45 billion during the same period in 2017.

Net interest income improved 20 per cent to Dh6.22 billion due to loan growth coupled with an improvement in margins. Non-interest income declined 2 per cent compared to the same period in 2017 as higher core fee income was more than offset by a reduction in investment securities income as a result of an impairment provision on a private equity fund holding.

Loans and deposits increased by 4 per cent and 3 per cent respectively since the beginning of the year. During the first half of 2018 the impaired loan ratio improved by 0.1 per cent to 6 per cent. The impairment charge during this period of Dh755 million is a 40 per cent lower than on the corresponding period of 2017.