ADCB Q3 profit drops, exiting Kuwait, Qatar markets
Abu Dhabi Commercial Bank (ADCB) on Sunday announced a Dh1.413 billion net profit for the third quarter of 2019, a decline of 13 per cent due to fall in interest income.
Net interest and Islamic finance income fell to Dh2.52 billion in the third quarter, down nine per cent year-on-year.
The bank announced that it would complete post-merger integration with Union National Bank and Al Hilal Bank ahead of schedule and also exit Kuwaiti and Qatari markets.
Its end-to-end integration timeline has been reduced by half to 17 months, bringing forward the completion date to the second-quarter of 2020.
"We have boosted shareholder value through an upward revision to our cost synergy target, from the preliminary assessment of Dh615 million to Dh840 million annually," said Ala'a Eraiqat, group CEO of ADCB.
The UAE bank has started exiting overseas operations as part of its strategy to focus on the local market. "Following the sale of the majority of our banking portfolio in India to DCB Bank, we are well on track to exit our operations in the Indian market. We have also initiated the process of exiting our operations in Qatar and Kuwait, and have informed the respective authorities accordingly," said Deepak Khullar, group CFO of ADCB.
Group operating income reached Dh3.272 billion in the third quarter, up 1 per cent sequentially. It reported pro forma net profit of Dh4.196 billion for the nine-month period in a challenging economic environment, marked by muted credit growth. Operating income for the nine-month period of Dh9.919 billion compared to Dh10.575 billion in the previous year. The group's net loans totalled Dh250 billion while customer deposits reached Dh263 billion.The bank's total assets stood at Dh407 billion as at 30 September 2019. Following the merger with Union National Bank (UNB) and acquisition of Al Hilal Bank, the Bank is continuing with a comprehensive purchase price allocation process, which is expected to be completed by the first quarter of 2020. Eraiqat said they remain positive on the long-term outlook for the UAE economy, which will be driven by continued investment in social and economic initiatives to promote sustainable growth.Its shares last closed at Dh7.570 on Sunday.