ADIB income rises despite challenges

Abu Dhabi Islamic Bank, the biggest Sharia-compliant lender in the emirate, said its first-quarter net income rose 6.9 per cent as revenues rose and non-performing accounts fell.

Despite a “challenging operating environment” , the bank said it was keen to press on with its expansion.

Net income increased to Dh482 million in the first three months of the year compared to Dh450.8m in the same period last year.

Revenues in the first quarter rose 7.6 per cent year-on-year to Dh1.31 billion.

The bank’s total non-performing accounts decreased year-on-year to 4 per cent versus 4.2 per cent in the first quarter and at the end of March totalled Dh3.2bn.

Still, the amount of money put aside for bad debt in 2016 increased by 6.7 per cent year-on-year to Dh216.2m.

“Despite very challenging conditions, ADIB has delivered a sustainable level of financial performance in Q1 2016 with steady growth in revenues and net profits,” said Tirad Al Mahmoud, the chief executive of ADIB.

“We recognise that continuing investment is required to build our customer focused franchises – and the infrastructure to support them – matched by the continuing commitment to oper­ate in accordance with international best practice governance, control and compliance requirements.”

Demand for business loans rose in the first quarter, the Central Bank said on Wednesday – but lenders are less willing to grant them.

The lender of last resort did not say why there was an increase in demand.

But analysts said that it could be because of payment delays trickling down the supply chain amid deteriorating economic conditions.

Demand for debt in the UAE was anecdotally declining in 2015 after the price of oil started its long descent in the previous year and bankers expect that loan growth will continue to diminish this year amid declining business confidence and higher credit hurdles that those demanding debt need to overcome to get it.

mkassem@thenational.ae

Follow The National’s Business section on Twitter

Avatar

Mahmoud Kassem

About Author

You may also like

ADFF Introduces New Award for Environmental Films

  • Sep 09, 2011
WAM Abu Dhabi, Sept. 6th, 2011 (WAM) -- The Abu Dhabi Film Festival (ADFF), organized by Abu Dhabi Authority for

DCL analyzes thousands of food and environmental samples

  • Sep 09, 2011
Tue 06-09-2011 22:08 PM WAM Dubai, Sept. 6th, 2011 (WAM) -- Food and Environment Laboratory Section of Dubai Central Laboratory