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Wed 27 Jan 2010 05:37 PM

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First Gulf Bank posts 27% rise in Q4 profits

Net income advances to AED855m, compared to AED671m for the same period in 2008.

First Gulf Bank posts 27% rise in Q4 profits

First Gulf Bank, owned by Abu Dhabi’s ruling family, said fourth-quarter profit rose 27 percent as net interest income improved.

Net income advanced to AED855 million ($233 million) from AED671 million in the same period a year earlier, the bank said on Wednesday in an e-mailed statement. For the full-year, net interest income and Islamic financing rose 49 percent to AED3.83 billion.

First Gulf posted a profit as other banks in the UAE report reduced lending and investment banking income and rising bad loans following the global financial crisis.

Abu Dhabi Commercial Bank said on Tuesday that its fourth-quarter loss widened after it more than doubled provisions for bad loans.

“FGB will continue its focus in the future to protect and strengthen its balance sheet,” CEO Andre Sayegh said.

Annual revenue increased 31 percent to AED6.2 billion and expenses fell 5 percent, the bank said. First Gulf earned AED66 million from its investments last year after a loss of AED229 million in 2008.

The bank’s full-year provisions rose to AED1.77 billion from AED566 million a year earlier.

UAE banks are being buffered by a debt crisis and concern they may have to set aside more money to cover potential losses as Dubai, the second-largest sheikhdom in the UAE, seeks to renegotiate repayment terms on borrowings.

Dubai World, one of Dubai’s three main state-owned business groups, said Nov. 25 that it would seek to delay debt payments for at least six months, roiling markets in the Middle East and around the world.

The global credit crisis led to a 50 percent drop in Dubai property prices and hampered the ability of local companies to borrow money and refinance loans.

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