ADCB Q3 net profit falls 17 pct

Abu Dhabi Commercial Bank missed analysts’ forecasts, after posting a 17 percent fall in thirdquarter profit on Sunday, due to higher impairments and lower interest income.

It is the second Abu Dhabi bank to report weaker earnings as lenders continue to be hit by reduced government spending in the United Arab Emirates and tight liquidity conditions in the wake of lower oil prices. A further three Abu Dhabi lenders are due to report earnings later this week.

The emirate’s second-largest bank by assets made a net profit attributable to shareholders of 999.1 million dirhams ($272 million) in the three months to Sept 30, compared to 1.20 billion dirhams in the same period a year ago, according to its financial statement.

Three analysts polled by Reuters had on average forecast a net profit for the quarter of 1.10 billion dirhams.

ADCB booked higher impairments of 380.4 million dirhams in the quarter, compared to 66.0 million dirhams in the year-ago period.

“Our bottom line was impacted by higher impairment allowances reflecting the current market conditions, while our asset quality metrics remain healthy with a non performing loan ratio of 2.6 percent and provision coverage ratio of 133.1 percent” as of Sept 30, Deepak Khullar, group chief financial officer, said in the statement. (RTRS)