ADCB posts record Dh6.43b net profit for 2022

Abu Dhabi Commercial Bank (ADCB) on Tuesday said its annual net profit surged 23 per cent to Dh6.434 billion as the bank generated new opportunities in an increasingly dynamic and diversified economy.

In a statement, the Abu Dhabi-based lender said its four-quarter net profit also rose 23 per cent to Dh1.784 billion while net interest income and non-interest income climbed 30 per cent and 45 per cent, respectively. The net interest income reached at Dh2.918 billion and non-interest income hit Dh1.486 billion during the October-December 2022 quarter.

Khaldoon Al Mubarak, chairman, ADCB, said the bank is building long-term resilience through strong financial performance, driven by a clear strategy, a positive culture and a robust governance framework.

“The bank achieved broad-based growth to deliver a record full-year net profit. A solid financial position means that ADCB is well placed to navigate complex challenges and to generate new opportunities in an increasingly dynamic and diversified economy,” he said.

“Our achievements are cementing the building blocks that will ensure ADCB remains at the forefront of the financial sector and creates long-term value for all stakeholders,” he said.

Ala’a Eraiqat, group chief executive officer, ADCB said ADCB is making significant progress to maintain a leadership position in customer service – from digital innovation and enhancement of data protection, to nurturing talent and applying best practice in ESG.

“Two years into our new strategy to drive digital-enabled growth, I am pleased to report record results for the bank. Full-year and quarterly net profit both increased by 23 per cent to Dh6.434 billion and Dh1.784 billion, respectively. This translated to a return on average tangible equity of 13.3 per cent for 2022,” he said.

Assets, customer deposits up

The bank’s annual operating income increased 17 per cent to Dh14.344 billion while operating profit before impairment charge of Dh9.456 billion rose 18 per cent last year. In 2022, the lender posted 15 per cent and 22 per cent increase in net interest income and non-interest income, respectively.

The lender also recorded 13 per cent increase in total assets as it amounted to Dh498 billion as at December 31, 2022 while total customer deposits rose 17 per cent to Dh309 billion. Current and saving account deposits (Casa) were Dh153 billion at December-end, and comprised 50 per cent of total customer deposits.

In view of the strong annual results, the board has recommended a dividend of Dh0.55 per share, equivalent to 60 per cent of net profit, translating to a pay out of Dh3.827 billion compared to Dh2.574 billion distributed in 2021. The proposed dividend will consist of cash and a stock dividend in the ratio of 33 per cent (cash dividend of Dh0.18 per share) and 67 per cent (stock dividend in lieu of cash of Dh0.37 per share), respectively. The issuance of stock dividend will strengthen the capital position of the bank to support reinvestment into further growth of core businesses.

The shares will be issued at a price of Dh7.10 per share arrived by applying a c.22 per cent discount on the six month average share price of the bank for the period from July 1, 2022 to December 31, 2022. This is subject to approvals by the Central Bank of the UAE, Securities and Commodities Authority (SCA) and by shareholders at the annual general meeting.

In 2022, Ala’a Eraiqat said the bank achieved loan growth of 6six per cent, with Dh65 billion of new credit extended to diverse economic sectors.

“We delivered double-digit growth in net interest income and fee income, while our leading franchise attracted Dh44 billion growth in customer deposits to exceed the Dh300 billion milestone,” he said.

Additionally, he said the bank’s cost to income ratio improved 480 basis points year on year to 29.6 per cent in the fourth quarter, at the lower end of our medium-term guidance, partially supported by one-off gains recorded in the quarter.

“The group’s major subsidiaries are also performing well, with Al Hilal Bank welcoming over 350,000 registered users in the first year since the launch of its super app, while ADCB Egypt reported a strong rise in 2022 net profit. Looking ahead, we are excited about the opportunities for ADCB to help drive the dynamic transformation of the UAE economy,” Ala’a Eraiqat concluded.

— muzaffarrizvi@khaleejtimes.com

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