First Abu Dhabi Bank (FAB), the largest bank in the UAE with total assets at AED 1.2 trillion ($320 billion) has reported strong numbers for the first half of 2024.
Driven by double-digit growth across interest and non-interest income sources, and helped by strong business momentum, net profit was at AED8.4 billion ($2.29 billion), while revenue was up 16 percent year-on-year to AED15.7 billion ($4.28 billion). Profit before tax grew 15 percent YoY to AED10.0 billion ($2.72 billion).
Net profit for the second quarter of 2024 was AED4.3 billion ($1.17 billion), and operating income was up 14 percent to AED7.8 billion ($2.12 billion).
Loans, advances and Islamic financing grew 6 percent both year-to-date and YoY to AED513 billion ($139.7 billion), reflecting healthy demand and market share gains across segments and geographies. Balance sheet fundamentals remained strong through solid asset quality metrics, with a non-performing loans (NPL) ratio of 3.7 percent, and a strong liquidity profile displayed in a liquidity coverage ratio of a healthy 152 percent.
The group’s international revenue was up 30 percent YoY, while operating income growth in the UAE also remained strong at over 13 percent YoY.
Hana Al Rostamani, Group Chief Executive Officer of FAB, said the outlook remains positive for the bank and commented: “FAB is reaffirming its position as a leading force in the MENA banking sector, with the group delivering another strong set of results.
“Our outlook remains anchored in the strong fundamentals of the UAE and Abu Dhabi as a global economic powerhouse and preferred hub for investment, talent, and innovation. We remain on track to meet our 2024 and medium-term guidance.
“FAB continues to leverage its international network to capitalise on market opportunities across the globe. The bank is actively building and expanding business corridors in close alignment with national ambitions, reinforcing our international franchise as a foundation for growth and resilience.”
FAB delivered a return on tangible equity (RoTE) of 17.3 percent, and 18.1 percent in Q2 2024. The Group’s cost-to-income ratio of 24.4 percent as of June-end 2024 demonstrated superior operating efficiency.
Lars Kramer, Group Chief Financial Officer of FAB, added: “Building on a robust first quarter, we continued to achieve high returns at scale while driving diversified growth across our franchise and investing strategically to create future efficiencies.
“Consistent growth in both interest and non-interest income sources reflect our efforts to enhance cross-sell and deepen client relationships, leveraging our differentiated strengths and international footprint.
“While lending momentum was healthy year-to-date, we have also benefited from incremental improvements in net interest margins for the fourth consecutive quarter, reflecting dynamic balance sheet management and optimal positioning ahead of a shift in interest rates.”
FAB’s exceptional YoY growth
Strong performance was witnessed across all business lines, led by Investment Banking and Global Markets, which saw an increase in operating income of 23 percent and 26 percent YoY, respectively. Consumer Banking operating income increased 16 percent YoY. Private Banking reported a 25 percent growth in assets under management.
The bank facilitated over AED52 billion ($14.16 billion) of sustainable and transition financing in the second quarter of 2024 and AED78 billion ($21.24) in the first six months. That took the total to date to AED200 billion ($56 billion), thus reaching 41 percent of FAB’s 2030 pledge of AED500 billion ($136 billion).
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