Combined bank records 12.4 per cent increase in net income in the first quarter of 2017
National Bank of Abu Dhabi (NBAD) and First Gulf Bank (FGB), the two Abu Dhabi lenders which merged in April, have reported a 12.4 per cent rise in first-quarter net income for the combined bank, the second largest in the Middle East and North Africa (Mena) region by assets.
The pro-forma net profit jumped to AED2.93bn ($797.8m) in the first three months of 2017, against AED2.6bn from a year-earlier period. Total assets stood at AED682.440bn, according to a statement Abu Dhabi Securities Exchange (ADX), where the shares of merged entity are traded as NBAD.
The bank reported a 145.5 per cent increase in other non-interest income to AED1.2bn, while its income from Islamic finance, fees and commissions slipped. Net interest and Islamic finance income dropped 4.9 percent to AED3.21bn, while net fees and commission slumped to AED799m, a 14.7 per cent decline from the amount reported at the end of March in 2016.
Operating expenses for the bank rose by 5.7 percent to AED1.53bn, while impairment charges dipped 3.9 percent to AED645m.
The combined bank, which plans to propose First Abu Dhabi Bank as the new name to shareholders at its general assembly meeting later this month, also reported a drop of 3.9 per cent in impairment charges to AED645m. Its operating expenses, however, have risen by to AED1.53bn, 5.7 per cent increase for the three-month period to 31 March.
In July, the boards of the two banks voted to merge the two financial giants and recommend the deal to respective shareholders, who in December, approved it. The merger transaction, backed by Abu Dhabi government, has created one of the top financial institution in the region with more than $185bn in by assets, which analysts say, will enable the merged entity to better compete at global level.
There were 5.643 billion of new ordinary NBAD shares issued to those shareholders of FGB who appeared on the share register of FGB immediately before the effective date. The number of outstanding NBAD ordinary shares following the capital increase have reached more than 10.89 billion.
Emirates NBD, the largest lender in Dubai, has also reported 4 per cent increase in its first-quarter net profit to AED1.87bn. The total Income of AED3.6bn was up 4 per cent quarter-on-quarter but declined by 7 when compared to the first three months of 2016, the lender said in a statement.
The banks total assets stood at AED452bn, an increase of 1 per cent from end of 2016. It also recorded a 2 per cent growth in customer loans to AED295.3bn, while customer deposits reached AED319.2bn, a 3 per cent increase for the period.
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