Abu Dhabi Islamic Bank’s Q1 net profit and revenue climb
abu dhabi — Abu Dhabi Islamic Bank (ADIB) on Monday said its first-quarter net profit rose by 1.7 per cent to Dh600.3 million.
In a statement, the bank said its first-quarter revenues increased by 5.3 per cent to Dh1.43 billion driven by growth in customer financing of 2.8 per cent to Dh78.1 billion, and a 57.5 per cent rise in investment income, which reached Dh185.3 million.
The Abu Dhabi-based Islamic lender said that foreign exchange income also surged 29.6 per cent during January-March 2019 quarter. The bank maintained a conservative approach to risk as total credit provisions reached Dh186.4 million.
According to financial results for first quarter, the capital adequacy ratio under Basel III at March 31, 2019 was 17.53 per cent compared to 16.02 per cent at March 31, 2018. It was stood firm at 17.18 per cent on December 31, 2018 after adjusting for the 2018 dividend.
ADIB remains one of the most liquid banks in the UAE, with an advances to stable funds ratio (a regulatory ratio) of 82.4 per cent at March 31, 2019 as against 80.4 per cent at March 31, 2018.
“The operating performance for the first quarter of 2019 was on track with operating profit increasing 6.2 per cent, delivering a solid return on equity of 18.3 per cent, which is considered one of the highest in the market. This was driven by higher revenues on the back of a growth in customer financing, increased foreign exchange and investment income. We are also seeing healthy momentum in key focus areas to which we have committed significant investment, such as digital and transaction banking,” Mazin Manna, ADIB CEO, said.
“The bank remains well-capitalised with a capital adequacy ratio under Basel III of 17.53 per cent, while the common equity Tier 1 ratio stood at 11.7 per cent. Our liquidity remains strong, with an advance to deposits ratio of 77.7 per cent,” he said.
“We continue to grow customer finance on a diversified basis across all sectors with our overall finance portfolio growing 2.8 per cent in the first quarter. We will continue to cautiously manage risk to ensure a stability in our finance portfolio. With regards to provisioning, we remained prudent in classifying our impaired portfolio and in taking provisions. As a result, we took additional provisions of Dh189.3 million for customer financing,” he added.
“We have invested heavily in new technology and embarked on a progressive digital transformation programme across the bank to help us expand and improve our service with ongoing enhancements of our digital platforms. We will be launching a number of new initiatives that can equip our customers to conduct their banking transactions in a more flexible, convenient and secure way.”