Abu Dhabi Commercial Bank (ADCB) published its financial results for the second quarter of 2023, reporting a net profit of AED1.932bn ($526m), an increase of 23 per cent year-on-year(YoY).
The strong performance is driven by broad-based income growth and improved efficiency metrics.
ADCB logged a net interest income of AED2.93bn ($797mm), an increase of 14 per cent YoY, and a non-interest income of AED1.129bn ($407m), a 22 per cent YoY increase.
ADCB profit report
Meanwhile, the bank’s operating income stood at AED4.059bn ($1.1bn), climbing 16 per cent YoY, with its cost to income ratio improving 260 basis points YoY to 32.5 per cent.
Looking at ADCB’s performance in H1’23 as compared to H1’22, net profit reached AED3.811bn ($1bn), a 25 per cent increase, net interest income stood AED5.782bn ($1.6bn), a 23 per cent increase, while non-interest income settled at AED2.19bn ($596m), rising by 28 per cent.
The operating income reached AED7.971bn ($2.2bn), increasing by 24 per cent, while the bank’s cost to income ratio improved 450 basis points YoY to 32 per cent.
Ala’a Eraiqat, ADCB’s Group Chief Executive Officer, said: “ADCB is experiencing solid growth momentum and continues to set new records, with first half net profit up 25 per cent year on year at AED3.811bn ($1bn), which translates into a return on average tangible equity of 14.8 per cent.
“The bank’s strong market position and digital innovation are driving growth against a backdrop of the UAE’s robust economic fundamentals.
“In the first half, ADCB extended AED38bn in new credit across diverse economic sectors and to the retail segment, resulting in net loan growth of five per cent during the period.
“In tandem, deposits have also increased by AED7bn, reflecting the trust that customers place in our franchise.
“The bank’s focus on service excellence is translating into strong growth in our customer base.
“In the first half, ADCB attracted a record of over 260,000 new retail customers through its UAE operations, and over 3,500 new corporate clients”.
Deepak Khullar, Group Chief Financial Officer at ADCB, said: “ADCB is delivering high quality earnings growth, reporting a 23 per cent year on year rise in Q2 net profit, characterised by a broad-based increase in revenues and disciplined cost management in the face of an inflationary environment.
“Healthy loan growth, coupled with rising benchmark rates, have driven a 14 per cent year on year increase in Q2 net interest income.
“It is also pleasing to see continued diversification in revenue streams. Quarterly fee and trading income were up 43 per cent and 48 per cent year on year, respectively.
“This contributed to a 22 per cent rise in non-interest income, which represented 27.8 per cent of total operating income in Q2, up from 26.4 per cent a year earlier.”
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