Abu Dhabi banks’ combined profit falls 14% in H1

The combined net profit of banks listed on Abu Dhabi Securities Exchange (ADX) registered a decline of 14 percent year-on-year (YoY) to AED 10.98 billion for the first half of 2016, due to higher provisions and lower operating income, data compiled by Argaam showed.

National Bank of Abu Dhabi (NBAD), the largest ADX-listed bank by assets, contributed the largest share to the sector’s earnings, with a net profit of AED 2.65 billion, or nearly 24 percent of the aggregate earnings. First Gulf Bank (FGB) followed with AED 2.64 billion in net profit.

United Arab Bank (UAB) reported a 79 percent YoY fall in net earnings to AED 71 million during the first half, due to a 32 percent drop in operating income and a 72 percent rise in provisions.

In terms of profit growth, Commercial Bank International (CBI) came on top with a 168 percent YoY surge, due to a 44 percent decline y-o-y in impairment provision to AED 109.1 million and improved operations.

Sharjah Islamic Bank (SIB) followed with a profit growth of 26 percent YoY during the same period.

ADX-listed banks reported a 6 percent rise in aggregate assets to AED 1.31 trillion in the H1, compared to AED 1.23 trillion in the same period last year.

Customer deposits grew 6 percent to AED 836.7 billion, while aggregate loans increased 1 percent y-o-y.

Abu Dhabi-listed banks traded at a P/E ratio between 6.1x and 25.2x trailing a 12-month adjusted net income. Thus, banks trade at an average P/E ratio of 9.2x, trailing 12-month adjusted net income, excluding the National Bank of Fujairah (NBF).

In the second quarter of this year aggregate net profit stood at AED 5.55 billion, decreasing 15 percent Y-o-Y.