News Column

Emirates NBD net profit up 30 per cent to AED 2.35 billion for H1 2014

July 24, 2014



Emirates NBD delivered its financial results for H1 2014. Net profit was up 30 per cent year on year to AED 2,350 million.

ENBD's performance for the first half of 2014 was helped by revenue growth in both Retail Banking & Wealth Management and Islamic Banking subsidiary, Emirates Islamic, which has become one of the fastest growing segments within the Group.

Net profit for the half year ended 30 June 2014 amounted to AED 2.35 billion, up 30 per cent from H1-13. Total Income for H1-14 grew by 27 per cent to AED 7.04 billion whilst Pre-Impairment Operating Profit for H1-14 improved by 35 per cent to AED 4.91 billion.

Total assets grew by two per cent to AED 348.3 billion in the first half of 2014. Customer loans increased by one per cent during the first half of 2014 to AED 241.8 billion. Customer deposits also increased by six per cent to AED 252.9 billion over the same period. The Bank's Advances to Deposits ratio improved to 95.6 per cent from 99.5 per cent at the end of 2013. The Bank's NPL ratio improved further to 13.5 per cent whilst the Tier 1 ratio strengthened to 15.6 per cent. Backed by this stronger liquidity and capital profile, on 20th July 2014, Emirates NBD were able to repay the remaining AED 4.8 billion Ministry of Finance Deposits received in 2008.

Group Chief Executive Officer, Emirates NBD, Shayne Nelson, said: "During the first half of 2014, we have delivered another healthy set of results, with net profit up by 30 per cent to AED 2.35 billion. This is driven by strong growth in both net interest income and non-interest income coupled with a firm control on expenses. I have focused management efforts on balance sheet optimization, diversification of income, addressing the legacy NPL position, improved capital efficiency and stronger liquidity. As a result the bank is in a healthier position than at the beginning of 2014 in each of these areas. I am confident that the Bank will continue to deliver excellent service to our customers and superior value to our shareholders."

Group Chief Financial Officer, Emirates NBD, Surya Subramanian, said: "The Bank has continued to deliver strong levels of operating profitability which is evident from the growth in both total income and pre-provision operating profit. Despite a competitive environment we have been able to maintain margins helped by growth in higher margin Retail and Islamic products, a more efficient funding base and a contribution from our Egyptian business. Costs remain firmly under control with a cost-to-income ratio of 30.3 per cent for the first six months on 2014, 4.2 per cent lower than the comparable period in 2013."

Total income for the first half ended 30 June 2014 amounted to AED 7,042 million; an increase of 27 per cent compared with AED 5,550 million in H1-13 and an increase of 12 per cent compared with AED 6,307 million in H2-13.

Net interest income for H1-14 improved by 25 per cent to AED 4,559 million from AED 3,661 million in H1-13.

The improvement in net interest income is attributable to an improved asset mix due to Retail and Islamic growth, an improved funding mix as ENBD continue to experience CASA growth and a contribution from our Egyptian business.

Non-interest income for the first half improved by 31 per cent to AED 2,483 million from the previous year, driven primarily by an increase in core banking fee income, particularly related to the growth in credit card business and trade finance volumes as well gains on the sale of a legacy property and other investments.

Costs for the H1 2014 amounted to AED 2,137 million, an increase of 12 per cent over H1-13 and a decline of six per cent compared to H2-13. Excluding Egypt, costs were up four per cent y-o-y. This four per cent increase is due to investment in customer service, IT and communication related costs in line with higher business volumes.

Total income for the first half ended 30 June 2014 amounted to AED 7,042 million; an increase of 27 per cent compared with AED 5,550 million in H1-13 and an increase of 12 per cent compared with AED 6,307 million in H2-13.

Net interest income for H1-14 improved by 25 per cent to AED 4,559 million from AED 3,661 million in H1-13. The improvement in net interest income is attributable to an improved asset mix due to Retail and Islamic growth, an improved funding mix as ENBD continue to experience CASA growth and a contribution from ENBD's Egyptian business.

Non-interest income for the first half improved by 31 per cent to AED 2,483 million from the previous year, driven primarily by an increase in core banking fee income, particularly related to the growth in credit card business and trade finance volumes as well gains on the sale of a legacy property and other investments.

Costs for the first half ended 30 June 2014 amounted to AED 2,137 million, an increase of 12 per cent over H1-13 and a decline of six per cent compared to H2-13. Excluding Egypt, costs were up four per cent y-o-y. This four per cent increase is due to investment in customer service, IT and communication related costs in line with higher business volumes.


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Source: CPI Financial


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