Abu Dhabi Islamic Bank (ADIB) reported a 58 per cent jump in its second-quarter net profit as impairment charges fell and total revenue rose, as the economic recovery gained pace.
Net profit for the three months to the end of June climbed to Dh501.2 million ($136.47m), the emirate’s biggest Sharia-compliant lender said in a statement to the Abu Dhabi Securities Exchange, where its shares trade.
Net revenue during the period rose 3.5 per cent year-on-year to Dh1.31 billion, while credit provisions and impairment charges fell 27 per cent Dh233.3m. Total expenses slid 8.6 per cent to Dh570m.
“Despite continued challenging market conditions, ADIB delivered robust year-on-year growth underscored by positive increases on our assets, revenues, and net profits while also maintaining a strong balance sheet, liquidity, and capital ratios,” Jawaan Al Khaili, chairman of the bank, said.
“Our return on shareholders’ equity have also improved to 14 per cent, in line with our commitment to enhance our profitability and deliver superior value to our shareholders.”
ADIB's net profit for the first six months of 2021 jumped 89 per cent Dh1.1bn as revenue rose 3.4 per cent to Dh2.6bn. Credit provisions and impairment charges dropped 48.2 per cent to Dh366.8m.
Banks in the UAE are reporting higher profits as the country’s economy continues to recover from the coronavirus pandemic on the back of higher oil prices and fiscal stimulus and monetary measures.
The country’s economy is expected to expand 2.4 per cent in 2021, according to the UAE Central Bank.
“Looking ahead and despite ongoing uncertainties, we believe that the UAE economy has the potential to have extremely robust, multi-year growth supported by the government stimulus measures, the strong vaccine roll out and the positive consumer sentiment around the potential end of the pandemic,” Mr Al Khaili said.
“Against this backdrop, we believe we are well positioned for a period of sustained growth for the rest of 2021, leveraging on our strong market position, strategic initiatives and operational resilience.”
Customer deposits in the first half of the year grew 7 per cent year-on-year to Dh105.2bn, while total assets climbed 5 per cent to Dh130.6bn, according to the lender.