Emirates NBD posts Dh1.8b profit on higher income, lower provisions
Despite challenging market conditions, Emirates NBD continued to achieve growth in revenue and net profit as various parts of the business delivered a robust performance in the first quarter
Dubai - Emirates NBD delivered a solid set of financial results with net profit up 8 per cent to Dh1.8 billion.
The healthy operating performance was helped by an increase in total income, driven by asset growth and stable core fee income, coupled with a control on expenses and lower provisions, according to the bank.
Despite challenging market conditions, Emirates NBD continued to achieve growth in revenue and net profit as various parts of the business delivered a robust performance in the first quarter, it added.
Total income for the first quarter grew by 2 per cent to Dh3.9 billion. Net interest income grew 3 per cent to Dh2.6 billion as loan growth more than offset a contraction in margins.
Non-interest income marginally declined by 1 per cent to Dh1.4 billion as core fee income held steady, bolstered by growth in credit card volumes, whilst income from property and investments declined due to lower one-off gains.
Commenting on the Group's performance, Hesham Abdulla Al Qassim, vice chairman, Emirates NBD said: "The Group is well positioned to utilise our strong franchise, capital and liquidity base to take advantage of opportunities within the region."
Group chief executive officer, Shayne Nelson said: "We remain cautiously optimistic for the remainder of 2016 but are conscious of the headwinds that a strong dollar and volatile oil price can present."
Emirates NBD estimates UAE economic growth at 4 per cent in real terms in 2015, down from 4.6 per cent in 2014. "We expect growth to slow further to 3 per cent this year as lower oil prices are likely to contribute to a tighter fiscal policy and slower non-oil sector growth," the bank said.
Tighter liquidity conditions and a strong dollar will continue to pose headwinds to non-oil growth, particularly in the services sectors. However, oil output is expected to rise in line with official targets and this should help to boost headline GDP growth.
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