Abu Dhabi Commercial Bank says it made $260m in the first three months of the year
Abu Dhabi Commercial Bank reported a 15 percent increase in first-quarter net profit on Tuesday, beating analysts' expectations, as the lender benefited from the improving local economic conditions.
The United Arab Emirates' fourth-largest lender by assets posted a net profit attributable to shareholders of AED953 million ($260 million) in the opening three months of 2014, up from AED829.5 million in the prior-year period.
Seven analysts polled by Reuters had estimated an average first-quarter profit of AED853.1 million.
UAE banks are expected to post strong profit growth in the first quarter, continuing the trend from 2013, as the local economy rebounds from a real estate crash and problems at Dubai sovereign-linked entities at the end of the last decade.
On Monday, Abu Dhabi Islamic Bank reported a 20.4 percent rise in earnings, citing higher lending.
First Gulf Bank and Emirates NBD are due to report their earnings for the first quarter on Wednesday and Thursday respectively.
Abu Dhabi Commercial Bank, nearly 60 percent owned by the Abu Dhabi government, saw a 10 percent increase in net interest income as lower interbank lending rates and a growing deposit base from low cost sources cut interest expenses by a third, the statement said.
The percentage of deposits made up of current and savings accounts (CASA) grew to 46 percent of the total at March 31 from 32 percent at the same point of 2013. CASA deposits are positive for banks as they don't have to pay any interest on them, as opposed to money borrowed from the interbank market.
Impairment allowances for the first quarter totalled AED174 million, down 46 percent from the AED322 million posted for the same period of 2013.
Loans and advances and deposits were stable over the year-end, chief executive Ala'a Eraiqat said in the statement.For all the latest banking and finance news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.