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NBAD’s H1 net profit soars 21% to Dh2 billion
Haseeb Haider / 28 July 2010
ABU DHABI — National Bank of Abu Dhabi, or NBAD, posted a 21 per cent profit in the first half of the year — reaching Dh2.032 billion — on the back of strong revenue growth.
Net profits for the second quarter ending on June 30 were up 10.4 per cent to Dh1.001 billion.
The second-largest bank in the UAE saw net interest income for the first half rising 16.3 per cent to Dh2.5 billion, while fees and other non-interest income also posted a double-digit growth of 11.6 per cent.
However, net interest margins in the same period were at 2.53 per cent, just slightly above the 2.50 per cent level in the same period in 2009.
“These are a strong set of results in ‘difficult’ markets reflecting the resilience and strength of the bank,” said Michael Tomalin, Group Chief Executive Officer of NBAD.
Operating income reached Dh3.5 billion, 14.9 per cent up compared with Dh3.1 billion as of June 30, 2009.
Total assets expanded 11.4 per cent to Dh202 billion at the end of the January-June period, with a quarter-on-quarter growth of 2.5 per cent.
In the January-June period, deposits slightly improved to Dh112.2 billion, after declassifying the Dh5.6 billion Ministry of Finance deposits to Tier 2 capital in 2010, compared with Dh111.7 billion in the corresponding period a year ago.
Loans and advances to customers grew by 8.7 per cent to Dh135 billion in the first six months period.
“The group continues to benefit from its strategy of diversified income sources, continuous investment in its franchise, robust risk management and focusing on relationships,” said NBAD Chairman Nasser Ahmed Khalifa Alsowaidi. Underlying performance of the loan book remains high; the collective provision of Dh1.685 billion continues to be maintained at 1.25 per cent of credit risk weighted assets.
At the end of the first half, non-performing loans, or NPLs, were 147 per cent covered and specific provision cover was at 66 per cent.
NPLs in the first six months of 2010 increased by Dh386 million to Dh2.073 billion on a portfolio of Dh135 billion, representing an NPL ratio of 1.5 per cent. A comfortable liquidity position was maintained during period.
Capital resources remained solid at Dh30.7 billion, 40.2 per cent up on Dh21.9 billion, total capital adequacy ratio on Basel II principles increased to 21.8 per cent up against 17.9 per cent a year earlier. The Tier-I capital ratio was at 15.5 per cent as at the end of the first half of 2010, the bank said.
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