ADIB recommends cash dividend of 46.6% of net profits

Abu Dhabi Islamic Bank (ADIB) has announced that its board of directors recommended a cash dividend of 20.58 fils per share which represents 46.6 per cent of net profits for the fiscal year ending December 31, 2020.

The dividend distribution is pending shareholders' approval at the bank's general assembly meeting, which is scheduled for April 4, 2021.

ADIB reported a net profit of Dh1.6 billion for the full year 2020 compared to Dh2.6 billion in 2019. However, the bank demonstrated a strong recovery of 73 per cent growth in net profit in H2 2020 compared to H1 2020 despite the lingering effects of the Covid-19 pandemic. This was driven by a 10 per cent increase in revenues due to a rebound in the UAE economic activity and an improvement in business momentum.

Throughout 2020, ADIB employed a rigorous approach to cost management, which resulted in a reduction of 7.7 per cent year on year in operating expenses, achieved through the successful implementation of technology-led initiatives that reduced the cost of sales and customer acquisition while also streamlining internal processes.

As of December 31, 2020, ADIB continues to maintain a robust capital position with Common equity Tier 1 ratio 12.94 per cent and Capital adequacy ratio of 18.8 per cent after the dividend adjustment, comfortably above regulatory requirements.

In 2020, ADIB raised the percentage of foreign ownership limit from 25 per cent to 40 per cent of its issued capital in response to heightened interest from international investors in the bank, and in line with the ADIB’s efforts and commitment to diversifying the bank’s investor base.

business@khaleejtimes.com