ADCB’s full-year profit jumps 38% on lower impairment charges

Net income for 2021 climbed to $1.43bn as the UAE economy continues to recover from the pandemic

Abu Dhabi Commercial Bank's profit for the year climbed to about $1.43 billion. Photo: ADCB

Abu Dhabi Commercial Bank, the UAE’s third-largest lender, reported a 38 per cent jump in its 2021 net profit on the back of lower impairment charges as the country's economy bounces back from the Covid-19 pandemic.

The total profit attributable to equity holders of the bank for the year climbed to $1.43 billion, the lender said in a statement to the Abu Dhabi Securities Exchange, where its shares are traded.

Impairment charges for the year slid 38 per cent year-on-year to $720 million, while net fees and commission income grew more than 22 per cent to $517m.

“ADCB’s strong financial performance in 2021 was underpinned by strong business fundamentals, with the additional benefits resulting from the merger in synergies and cost savings evidenced in our financial and operating results,” Khaldoon Al Mubarak, ADCB’s chairman said.

“Our unwavering commitment to best practice governance, healthy organisational culture, and balance sheet resilience provide the deep foundations for the Group's success as we continue the execution of our five-year growth strategy, with a relentless focus on the opportunities enabled by our digital transformation.”

Banks in the country are reporting higher profits as the UAE’s economy continues to recover from the pandemic. First Abu Dhabi Bank, Emirates NBD and Dubai Islamic Bank have all posted higher profits for 2021.

ADCB’s fourth-quarter profit jumped 44 per cent to Dh1.4bn as net impairment charges dropped 29 per cent to Dh669m.

Net loans and advances for the full year rose 2 per cent to Dh244bn, while customer deposits jumped 5 per cent to Dh266bn.

“Increased fee income also made a strong contribution to our revenues, while our major subsidiaries, Al Hilal Bank and ADCB Egypt, have made substantial progress towards becoming important engines of growth for the Group,” said Ala'a Eraiqat, ADCB's group chief executive.

ADCB Egypt reported 32 per cent growth in full-year net profit to 413m Egyptian Pounds.

Other key achievements in 2021 included the acquisition of Abu Dhabi Finance’s mortgage portfolio, major progress in the restructuring of NMC, and the bank’s increased role in capital market transactions, it said.