Union National Bank, the lender in which the governments of Abu Dhabi and Dubai both own stakes, reported third-quarter profit that missed analyst estimates as impairment charges rose and fee and trading income declined.
Net income fell 12 per cent to Dh480.6 million, the Abu Dhabi-based bank said in a statement to the stock exchange on Sunday. Impairment charges jumped 57 per cent to Dh199.8m. Fee and commission income dropped 16 per cent and the lender had a loss from currency and derivatives trading in the quarter versus a profit a year ago.
A near-halving of oil prices over the past year is beginning to hurt growth in the UAE and may be leading to a rise in loan defaults. United Arab Bank, another UAE lender, this month reported a Dh272.6m loss in the third quarter compared with a profit a year ago owing to provisions made after an increase in loan defaults in “higher risk” commercial loans.
Commercial Bank International also reported yesterday a Dh28.6m loss compared with Dh64.9m profit a year ago. Impairment losses and provisions climbed 63 per cent to Dh115.1m.
Meanwhile, Sharjah Islamic Bank said net profit rose 1.2 per cent to Dh298.4m for the nine months of 2015 compared to Dh295m for the same period last year. The bank did not provide a breakdown for the third quarter.
Total assets grew by 8.3 per cent to Dh28.2 billion at the end of the third quarter compared to Dh26bn at the end of 2014.
Sharjah Islamic said customer deposits advanced 9.2 per cent to Dh15.9bn compared to Dh14.6bn at the end of 2014.
The bank’s annualised return on average shareholders’ equity reached 8.59 per cent by the end of the third quarter compared to 8.27 per cent at the end of December last year, while annualised return on average assets was 1.47 per cent by the end of the third quarter compared to 1.58 per cent at the end of December 2014.
Elsewhere, Ajman Bank said its profit for the third quarter ended in September increased to Dh32m from Dh20.5m in the same period last year.
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