First Abu Dhabi Bank posts 61% jump in Q2 profit

Group operating income amounted Dh13.6 billion

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Published: Thu 20 Jul 2023, 11:17 PM

Last updated: Sun 23 Jul 2023, 3:21 PM

First Abu Dhabi Bank (FAB), the UAE’s largest bank by assets, has announced a 61 per cent year-on-year jump in second-quarter 2023 net profit to Dh4.2, driven by higher interest and non-interest income.

The bank said Q2 results enabled it to demonstrate record performance with a first-half 2023 net profit of Dh8.1 billion, the highest ever achieved by the banking group in a half-year period.

The bank’s net interest income rose 32 per cent YoY to reach Dh4.5 billion in the quarter, while its non-interest income surged 34 per cent to Dh2.3 billion. Operating income in the second quarter jumped 37 per cent from a year earlier to Dh6.8 billion, a FAB statement said. Net impairment charges in the quarter were at Dh676 million, down 15 per cent from the first quarter.

Hana Al Rostamani, group chief executive officer of FAB, said the outstanding results in the first half of 2023, delivering a net profit of Dh8.1 billion and operating income of Dh13.6 billion, were the highest ever achieved by FAB in a half-year period.

“With its robust fundamentals, solid financial standing, and total assets surpassing Dh1.1 trillion, FAB is among the largest and strongest financial institutions globally, with a combined credit rating of AA- or equivalent. Moreover, the recent rating affirmations by Moody's and Standard & Poor's are a compelling testament to the Group’s resilience through the cycles,” said Al Rostamani.

She said the group’s achievements demonstrate steady progress against the lender’s growth strategy and strengthen its position as the financial institution of choice. “Throughout the quarter and in the first half of this year, we have fulfilled our commitment to delivering the best financial and banking products and services to our clients across our diversified franchise, while empowering the UAE’s status as a global financial hub.”

"FAB posted a very strong set of financial results, as evidenced by record underlying revenue and profits both in the second quarter and in the first half of 2023. Despite the persistence of macroeconomic headwinds on a global scale, FAB is very well positioned to deliver solid results and unlock its full potential as a regional banking powerhouse," Lars Kramer, FAB's chief financial officer, said in the statement.

“The results demonstrate that the group continues to manage risks, control costs and maintain a robust foundation underpinned by strong organic capital generation,” the Abu Dhabi-based lender said. The bank’s common equity Tier 1 (CET1) strengthened to 13.6 per cent in the three months ended June 30 compared to 12.6 per cent in the same period a year earlier.

The bank said that positive growth momentum was sustained across all business lines during the quarter under review as the Abu Dhabi-listed lender continued to invest in people, products and technology to enhance customer experience across its portfolio.

FAB’s total assets edged up 3.0 per cent year-to-date to Dh1.14 trillion sustained by sizable deposit inflows deployed across loans and high-quality liquid assets. “Customer deposits have grown by 6.0 per cent YTD to reach Dh745 billion with current account and savings account balances at a new high of Dh333 billion, reflecting strong performance in cash management,” the lender said.