Bank shareholders are to be rewarded with almost Dh8 billion (US$2.17bn) in dividend payouts as lenders look set to eclipse last year's total.
Six of the UAE's biggest lenders have reported dividend payouts worth Dh7.8bn, and with several big banks still to report earnings, that figure could yet rise.
An analysis of last year's dividend payouts show that the entire banking sector paid Dh8.08bn last year, putting lenders on track to exceed that sum this year.
"It's been way beyond expectations," said Talal Touqan, the head of research at AlRamz Securities. "Profitability has got higher and higher as provisions are being reversed."
Current dividend yields on local stocks, running at 6 to 7 per cent, were significantly higher than returns on offer on cash, bonds or many developed market equities, making the region look "extremely lucrative, within the region and internationally," Mr Touqan added.
Yesterday, First Gulf Bank (FGB) announced a Dh2.5bn shareholder payout as its international operations supported a rise in revenues.
Rival lenders Abu Dhabi Commercial Bank and Emirates NBD also increased dividend payouts as the UAE's banks showed signs of recovery from the economic slump of the past few years.
One of the biggest banks in the capital, FGB generated net income of Dh1.1bn in the fourth quarter of last year, an increase of 12 per cent compared with the same period a year earlier.
FGB said it had recommended a cash dividend of 83 fils per share, equivalent to a payout of Dh2.5bn. The bank's full-year earnings of Dh4.1bn were 12 per cent higher than in 2011 and beat estimates of Dh4bn.
UAE banks are under close scrutiny for signs of stability after the crisis of the past few years, but lending growth in the Emirates has remained weak for many lenders.
FGB had sought to diversify its sources of revenue geographically and across different business sectors, paying off in stronger earnings throughout the year, said Andre Sayegh, FGB's chief executive.
"FGB has been successful in building a powerhouse of diversified and stable revenue generating businesses, while our overseas presence will gain an important momentum going forward," he said.
ADCB reported full-year profits of Dh2.8bn, a decline of 8 per cent from 2011 when earnings were boosted by the sale of a 25 per cent stake in RHB Capital Berhad, a Malaysian lender, to Aabar Investments.
The bank's loan book shrank by 1 per cent to Dh123.1bn, while deposits were flat on a year-on-year basis at Dh109.2bn.
ADCB boosted its dividend by 5 percentage points to 25 fils per share despite the lower earnings, having returned its first payment to shareholders since the global financial crisis last year. The bank announced a 10 per cent share buyback this week, which would cost it Dh1.9bn.
Yesterday, Emirates NBD said it would pay a 25 fils per share dividend, increasing its dividend by a similar amount from last year. The bank is due to report full-year earnings today.
If approved, both banks' dividend payouts will amount to about Dh1.4bn.
The banks' increased payouts come as UAE banks seek to reward investors with generous dividend payments. Last week, Commercial Bank of Dubai announced a Dh611.5 million dividend payout, equal to two thirds of earnings, while RAKBank has reported a cash dividend of Dh609.5m.
Banks including Union National Bank, Mashreq and Dubai Islamic Bank are yet to report earnings and could add to the dividend payouts.
FGB's profit boost was driven by a 9 per cent increase in lending, almost three times the UAE sector-wide average, by diversifying away from the Emirates towards emerging markets.
Revenues from the bank's branches in Singapore, India, Qatar and Libya more than doubled to Dh307m.
The pace of expansion had allowed FGB to retain its high dividend payments, said Abdulhamid Saeed, the bank's managing director.
ghunter@thenational.ae
Important questions to consider
1. Where on the plane does my pet travel?
There are different types of travel available for pets:
- Manifest cargo
- Excess luggage in the hold
- Excess luggage in the cabin
Each option is safe. The feasibility of each option is based on the size and breed of your pet, the airline they are traveling on and country they are travelling to.
2. What is the difference between my pet traveling as manifest cargo or as excess luggage?
If traveling as manifest cargo, your pet is traveling in the front hold of the plane and can travel with or without you being on the same plane. The cost of your pets travel is based on volumetric weight, in other words, the size of their travel crate.
If traveling as excess luggage, your pet will be in the rear hold of the plane and must be traveling under the ticket of a human passenger. The cost of your pets travel is based on the actual (combined) weight of your pet in their crate.
3. What happens when my pet arrives in the country they are traveling to?
As soon as the flight arrives, your pet will be taken from the plane straight to the airport terminal.
If your pet is traveling as excess luggage, they will taken to the oversized luggage area in the arrival hall. Once you clear passport control, you will be able to collect them at the same time as your normal luggage. As you exit the airport via the ‘something to declare’ customs channel you will be asked to present your pets travel paperwork to the customs official and / or the vet on duty.
If your pet is traveling as manifest cargo, they will be taken to the Animal Reception Centre. There, their documentation will be reviewed by the staff of the ARC to ensure all is in order. At the same time, relevant customs formalities will be completed by staff based at the arriving airport.
4. How long does the travel paperwork and other travel preparations take?
This depends entirely on the location that your pet is traveling to. Your pet relocation compnay will provide you with an accurate timeline of how long the relevant preparations will take and at what point in the process the various steps must be taken.
In some cases they can get your pet ‘travel ready’ in a few days. In others it can be up to six months or more.
5. What vaccinations does my pet need to travel?
Regardless of where your pet is traveling, they will need certain vaccinations. The exact vaccinations they need are entirely dependent on the location they are traveling to. The one vaccination that is mandatory for every country your pet may travel to is a rabies vaccination.
Other vaccinations may also be necessary. These will be advised to you as relevant. In every situation, it is essential to keep your vaccinations current and to not miss a due date, even by one day. To do so could severely hinder your pets travel plans.
Source: Pawsome Pets UAE
What is a robo-adviser?
Robo-advisers use an online sign-up process to gauge an investor’s risk tolerance by feeding information such as their age, income, saving goals and investment history into an algorithm, which then assigns them an investment portfolio, ranging from more conservative to higher risk ones.
These portfolios are made up of exchange traded funds (ETFs) with exposure to indices such as US and global equities, fixed-income products like bonds, though exposure to real estate, commodity ETFs or gold is also possible.
Investing in ETFs allows robo-advisers to offer fees far lower than traditional investments, such as actively managed mutual funds bought through a bank or broker. Investors can buy ETFs directly via a brokerage, but with robo-advisers they benefit from investment portfolios matched to their risk tolerance as well as being user friendly.
Many robo-advisers charge what are called wrap fees, meaning there are no additional fees such as subscription or withdrawal fees, success fees or fees for rebalancing.
Brief scoreline
Switzerland 0
England 0
Result: England win 6-5 on penalties
Man of the Match: Trent Alexander-Arnold (England)
