FAB chief hails 'resilient' performance amid pandemic

The chief executive of First Abu Dhabi Bank, the UAE's largest lender, said it delivered a "resilient" performance for the first nine months of the year in the face of "unprecendented economic and market conditions".

Third quarter net profit slid 19 per cent to Dh2.5 billion ($680 million), as operating income fell 15 per cent to Dh4.3bn year-on-year, the bank said in a statement to the Abu Dhabi Securities Exchange, where its shares trade. Impairment charges rose 7 per cent to Dh504m.

"With total assets almost reaching the Dh1 trillion mark as of September-end 2020, our robust foundation enabled us to continue to support our clients, and to benefit from the gradual rebound in economic activity and market sentiment," the bank's chief executive, André Sayegh, said.

Lenders around the world are facing challenging market conditions as a result of the Covid-19 pandemic, which has crimped growth and tipped the global economy into its deepest recession since the 1930s.

Monetary stimulus undertaken by governments have pushed interest rates to zero or near-zero in many countries, making it harder for banks to generate profit.

Most banks have also had to record higher provisions to account for likely increases in loan losses.

The top lenders in the US and Europe Banks have provisioned $139bn as bad debt losses could exceed $880bn by 2022, according to ComprarAcciones.com data.

Earlier this month, ratings agency Moody's said adverse conditions could lead to more mergers among lenders in the Gulf, as the revenue shock from the pandemic and lower oil prices "will shift management attention to cost discipline and consolidation opportunities".

FAB said it is continuing to extend support to clients to mitigate the effects of the pandemic and had deferred Dh7.5bn worth of debt owed by retail, SME and corporate customers under the Central Bank of the UAE's Targeted Economic Support Scheme as of the end of September.

"In addition to TESS, FAB continued to provide relief to customers through its own programmes," the lender said.

FAB's net profit for the first nine months slid 22 per cent to Dh7.3bn, from the year-earlier period. Total operating income was 10 per cent lower at Dh13.7bn.

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Why are asylum seekers being housed in hotels?

The number of asylum applications in the UK has reached a new record high, driven by those illegally entering the country in small boats crossing the English Channel.

A total of 111,084 people applied for asylum in the UK in the year to June 2025, the highest number for any 12-month period since current records began in 2001.

Asylum seekers and their families can be housed in temporary accommodation while their claim is assessed.

The Home Office provides the accommodation, meaning asylum seekers cannot choose where they live.

When there is not enough housing, the Home Office can move people to hotels or large sites like former military bases.

THE BIO

Born: Mukalla, Yemen, 1979

Education: UAE University, Al Ain

Family: Married with two daughters: Asayel, 7, and Sara, 6

Favourite piece of music: Horse Dance by Naseer Shamma

Favourite book: Science and geology

Favourite place to travel to: Washington DC

Best advice you’ve ever been given: If you have a dream, you have to believe it, then you will see it.

Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”