Banking giant expects to see pressure on earnings

Emirates NBD, the Gulf region's biggest bank by assets, sees earnings under pressure from non-performing loans during the economic crisis, the group's chief financial officer said on Monday.

"As we go through the year, we will see the materialisation of non-performing loans," chief financial officer Sanjay Uppal said.

"As that happens, there will be some impact on the sustainability of the earnings level, we will see a certain amount of pressure," Uppal said in an interview with Reuters Financial TV.

Emirates NBD in April reported a 5.3 percent rise in first-quarter net profit and said it expected 2009 net profit to be similar to 2008.

"We obviously need to redefine (the outlook) every quarter as we go through our performance," Uppal said. The global economic environment calls for "prudence in your outlook," he added.

Uppal said the central bank's recent draft guidelines aimed at raising the corporate governance standard in the region are "a very positive development".

"It is something that is part of the evolution of the financial services industry in the UAE, the banks have come a long way in the last five years ... it also has seen a huge development in the complexity of the business we do," Uppal said. (Reuters)

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