FAB reports 4% surge in third quarter profit
The bank said it continued to demonstrate balance sheet strength through improved liquidity, funding, and capital ratios.
First Abu Dhabi Bank (FAB), the UAE’s largest bank, reported on Monday a 22 per cent drop in net profit to Dh7.3 billion year-on-year for the first nine months of 2020 as its assets almost reached the Dh1 trillion mark in September.
The drop was mainly due to “higher impairment charges and softer revenue, partly mitigated by cost optimisation,” the lender said in a statement.
For the third quarter, the bank posted a 4.0 per cent surge in net profit to Dh2.5 billion. “Following a resilient first quarter, the bank delivered solid results in the third quarter of 2020, reflecting a rebound in economic activity, a healthy business momentum across corporate and investment banking and personal banking,” it said.
The bank said it continued to demonstrate balance sheet strength through improved liquidity, funding, and capital ratios. “Asset quality remained resilient underpinned by diligent risk management and a conservative risk profile, supported by the relief measures under the UAE Central Bank TESS programme.”
André Sayegh, FAB’s group CEO, said the bank delivered a resilient performance in the first nine months, successfully managing key risks in the face of unprecedented economic and market conditions.
“With total assets almost reaching the Dh1 trillion mark as of September-end 2020, our robust foundation enabled us to continue to support our clients, and to benefit from the gradual rebound in economic activity and market sentiment. Leveraging our competitive strengths, we were proud to lead prominent transactions for our clients in the third quarter, and to continue to support trade and investment flows across the region,” Sayegh said.
FAB’s new partnership with ADQ and its future digital bank also represents a new milestone for the lender, as part of its commitment to support Abu Dhabi’s digital ambitions, Sayegh added.
James Burdett, group chief financial officer, said the third-quarter performance marked the bank’s strongest quarterly performance this year. “While we continued to face headwinds from low interest rates and the challenging environment brought about by the ongoing pandemic, this was offset by higher fee-based income reflecting a rebound in business activity with sales volumes in returning to pre-Covid levels, and strong results from our continued focus on cross-selling and revenue diversification,” he said.
Reflecting strong cost discipline, FAB’s operating expenses improved 7.0 per cent year-on-year amid ongoing investments in key strategic and digital initiatives designed to enhance productivity and create future efficiencies, Burdett, said.
“While we continued to build prudent provisions against our portfolio, we benefitted from the partial resolution of a large corporate account which resulted in lower impairment charges sequentially. With a CET1 (Common Equity Tier) ratio at 14 per cent, our capital position is strong and comfortably above regulatory requirements,” he said.
Sheikh Ahmed welcomes UK's decision to remove the need for travellers ... READ MORE
Those travelling to the UK from the UAE from Saturday will no longer... READ MORE
Company maintains strong performance despite challenging environment READ MORE
Nine-month sales at Dh1.6B; balance sheet remains strong READ MORE
Companies will no longer need to have an Emirati sponsor. READ MORE
The Saudi health ministry said it hopes to have enough vaccines to... READ MORE
The scheme shall cancel all black points along with the fines... READ MORE
The GDRFA and the Dubai Police also announced that the girls'... READ MORE