ADIB Q3 net profit hits Dh620m

Abu Dhabi Islamic Bank (ADIB) has posted a 5.2 per cent increase in net profit to Dh620 million for Q3 2019, and a 5.6 per cent growth for the first nine months of 2019 to Dh1,850.5 million.

The bank's operating profit grew 8.7 per cent to Dh828.9 million compared to Dh762.7 million in Q3 2018, driven by a rise in net customer financing to Dh79.2 billion in the first nine months. This was in addition to a growth in non-financing income on the back of higher investment income, which was up 58.9 per cent to Dh195 million in Q3 2019, and a 5.1 per cent rise in fees and commission to Dh280 million.

Net revenues increased by 5.5 per cent to Dh1,503.7 million due to a 58.9 per cent growth in investment income and 5.1 per cent rise in fee income. Net profit margin stood at 4.22 per cent, despite the lower rates in the market helped by the positive impact of the low cost of fund. Total equity (including Tier 1 capital instruments) was Dh18.4 billion at September 30, 2019, an increase of 13.6 per cent yearon-year and a three-year compounded growth rate of 5.6 per cent. ADIB's capital adequacy ratio under Basel III as at September 30, 2019 was 18.84 per cent; the Tier 1 capital ratio was 17.74 per cent and the common equity Tier 1 ratio stood at 13.03 per cent.

"Our financial and operational performance in the third quarter of 2019 reflects the effective execution of our strategy," said Mazin Manna, ADIB Group CEO. "ADIB's operating profit increased by 8.7 per cent year-on-year in Q3 2019 supported by a growth in income from financing, and higher investment and fee income. This led to a healthy return on equity of 18 per cent. Our Q3 net profit increased by 5.2 per cent to Dh620 million after increasing our credit provisions and impairments by 20.8 per cent to Dh207.5 for Q3 2018." "Despite a low rate market environment our net profit margins was at 4.22 per cent helped by the positive impact of the low cost of fund that is supported by higher CASA balances.