Abu Dhabi Commercial Bank Q2 Profit Jumps 23% on Growth

Abu Dhabi Commercial Bank (ADCB), the UAE's third-largest lender by assets, announced an impressive 23 percent increase in its second-quarter profit, buoyed by surging net interest and Islamic financing income amidst the country's ongoing economic momentum.

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ADCB Reports Strong Growth in Q2 Amid Economic Momentum

The bank's net profit for the three months ending June reached Dh1.93 billion ($525 million), as stated in a release to the Abu Dhabi Securities Exchange. ADCB's net interest income and Islamic financing proceeds experienced a notable 14 percent jump, totaling Dh2.93 billion.

ADCB's Strong Growth Momentum Propels Record-Breaking Performance Amid UAE's Economic Rebound

ADCB's group chief executive, Ala’a Eraiqat, expressed confidence in the bank's performance, stating that it is currently enjoying solid growth momentum and consistently setting new records. Non-interest income for the reporting period witnessed a substantial 22 percent year-on-year increase, reaching Dh1.13 billion. In addition, the lender's operating income surged by 16 percent on an annual basis, amounting to Dh4.06 billion , The UAE's economy has remarkably rebounded from the Covid-19 pandemic's effects, driven by higher oil prices and government measures to mitigate the impact. The country's GDP grew by 7.6 percent in 2022, marking the highest growth rate in 11 years. The economy is projected to expand by 3.9 percent this year and 4.3 percent in 2024, according to data from the UAE Central Bank.

ADCB Reports Strong Profitability with Rising Net Interest Income Amid UAE's Economic Momentum

The bank attributed the sharp rise in net interest income to higher volumes and rising benchmark rates. Net interest margin (NIM), a crucial profitability metric, climbed by 16 basis points year-on-year to 2.73 percent in the second quarter. Additionally, ADCB's risk-adjusted NIM increased by 20 basis points annually to 2.06 percent by the end of the reporting period , With interest rates on the rise and the UAE's economic momentum continuing, Moody's Investors Service projected that the profitability of the country's four largest banks would further improve this year. ADCB's net income for the first half of the year rose by an impressive 25 percent to Dh3.81 billion, while net interest income during the same period jumped by 23 percent, reaching Dh5.78 billion.

ADCB Witnesses Impressive Growth in Assets and Customer Base Amid Favorable Economic Climate

Assets at the end of the first half of the year climbed to Dh521 billion, representing a substantial 9 percent year-on-year increase. Furthermore, ADCB's total customer deposits experienced an 8 percent annual rise, reaching Dh316 billion. The bank also achieved strong growth in its customer base, attracting a record 260,000 new retail customers and onboarding over 3,500 new corporate clients , Despite global economic uncertainties, the UAE's economy continues to benefit from consistent investment flows and robust consumer and business confidence, bolstering ADCB's strong growth trajectory. Ala’a Eraiqat reiterated that this growth reinforces the bank's financial position, enhances resilience, and creates significant shareholder value.

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