Union National Bank reports 20 per cent fall in profit

01 February 2010

Real estate exposure and loan provisions weigh on profits

Abu Dhabi’s Union National Bank has reported profits for 2009 of AED1.16bn ($316m), a decrease of 19.7 per cent from 2008.

The bank said the fall in profits was due to the decline in value of its investment properties and impairment charges on loans and advances.

The bank said loans and advances were flat at AED50.8bn and deposits increased by 3.7 per cent to AED51.3bn. Total assets rose by 16.1 per cent to AED75.7bn, compared to AED65.2bn at the end of 2008.

Non-performing loans as a ratio to total loans increased from 1.3 per cent to 1.5 per cent, which was largely attributed to exposure to Saudi conglomerate Ahmad Hamad al-Gosaibi & Brothers. The bank said in the fourth quarter it made provisions of AED2bn, driving it into a fourth quarter loss of AED1.2bn.

Union National Bank is the fifth largest bank in Abu Dhabi.

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