NBF’s nine-month net profit up 15.1% to Dh462.1m

Dubai: National Bank of Fujairah (NBF) reported a net profit of Dh462.1 million for the first nine months of 2018, up 15.1 per cent compared to the same period last year.

For the third quarter of the year, the bank’s net profits were up 26.3 per cent to Dh152 million compared to Dh120 million reported in the same quarter in 2017.

Operating profit for the third quarter rose 24.4 per cent year on year to Dh284.5 million and for the nine-month period in 2018, the bank reported an operating profit of Dh804.4 million, up by 20.5 per cent compared to Dh667 million reported in the same period last year.

Operating income for the first nine months of the year surged 16.6 per cent to Dh1.2 billion.

Net interest income and net income from Islamic financing and investment activities for the nine-month period grew 20.7 per cent to Dh812.6 million compared to the same period in 2017. As a result of rise in volume of business, the bank’s margin improved from 2.58 per cent in 2017 to 2.84 per cent in the first nine months of 2018.

While foreign exchange and derivatives income experienced solid growth of 45.3 per cent to Dh103.1 million for the nine-month period this year, the bank reported lower fee and commission income from the corresponding period last year, attributed to reduction in traditional lending and trade related fees as well as the impact of VAT implementation.

Nine-month financial data showed that NBF’s loans and advances and Islamic financing receivables rose 10.6 per cent from Dh24.1 billion at the year-end 2017 to Dh26.6 billion. The bank reported a year on year growth of 12.6 per cent in loans and Islamic financing for the nine months of 2018. Customer deposits for the nine-month period in 2018 grew 11.9 per cent to Dh29.2 billion year on year.

The bank’s operating expenses increased by 8.9 per cent driven by investment in business, systems and infrastructure including digitisation initiatives. Net impairment provisions for the nine-month period was Dh342 million compared to Dh266 million in the same period last year. Total provision coverage ratio (including credit risk reserve) improved to 97.9 per cent at the close of the third quarter compared to 89.5 per cent at the year end 2017. The NPL ratio stood at 5.52 per cent at the close of the nine-month period compared to 5.53 per cent at year-end 2017.

NBF continued to maintain strong capital adequacy ratio of 16.6 per cent with Tier 1 ratio of 14.3 per cent at the close of the third quarter of this year. Bank’s return on average assets for the nine-month period in 2018 was at 1.6 per cent, up from 1.5 per cent for the corresponding period last year while return on average equity was 1.5 per cent, up from 11.4 per cent in the same period in 2017.