The UAE’s two biggest banks have posted a jump in annual profit, topping estimates, after the country’s strong economic growth helped to drive an increase in margins and net interest income.
Profit at First Abu Dhabi Bank rose 7% to AED13.4bn ($3.6bn) after the lender’s “core businesses sustained positive momentum, resulting in double-digit growth in loans and deposits,” it said in a statement.
Income increased 10%, boosted by a 23% growth in net interest income and gain on the sale of majority stake in payments business Magnati.
UAE bank performance
“Underlying operating performance across our core businesses was sustained during the fourth quarter despite a more challenging global macroeconomic outlook,” FAB CEO Hana Al Rostamani said in the statement.
“This has provided us headroom to further build provision buffers, take a conservative stance on asset valuations.”
Meanwhile, profit at Emirates NBD surged 40% to AED13bn ($13.5bn), while impairment charges fell 12% to AED5.2bn ($1.4bn).
Dubai’s biggest bank “maintained strong income growth momentum, kept a firm control of costs and benefited from writebacks and recoveries, reflecting a healthy regional economy,” CEO Shayne Nelson said in a statement.
The UAE economy has been booming after the government’s handling of the coronavirus pandemic.
The country also benefited from a surge in oil prices in the first half of 2022 and has become an attractive place for investors looking for a place to park their wealth.
The UAE looks “very immune” if a recession in the world economy materialises this year, Thani Al-Zeyoudi, the country’s minister of state for foreign trade, said in Davos last week.
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