ADCB's net profit rises 27% to hit AED1.87 billion in Q1'23

ADCB's net profit rises 27% to hit AED1.87 billion in Q1'23

ABU DHABI, 17th April, 2023 (WAM) -- Abu Dhabi Commercial Bank (ADCB) has announced a 27 percent increase in net profit during the first quarter of 2023, reaching AED1.878 billion. The bank's net interest income also grew by 33 percent settling at AED2.851 billion, while non-interest income increased by 34 percent to reach AED1.061 billion.

ADCB's operating profit before impairment charge grew by 47 percent, totalling AED2.681 billion, and operating income increased by 33 percent to AED3.912 billion.

ADCB's total assets amounted to AED501 billion, up 13 percent compared to the first quarter of 2022 and by 1 percent compared to the end of 2022. Meanwhile, net loans and advances increased by 7 percent to reach AED264 billion compared to the first quarter of 2022, and customer deposits increased by 19 percent to reach AED311 billion compared to the first quarter of 2022.

In addition, the bank granted AED20 billion in new credit facilities during the first quarter of 2023. Customer deposits in current and savings accounts amounted to AED158 billion, accounting for 51 percent of total customer deposits, an increase of AED5 billion by the end of the first quarter of 2023.

ADCB's capital adequacy ratio reached 15.67 percent, and the first-tier ratio reached 12.93 percent, while the liquidity coverage ratio (LCR) reached 132.9 percent. The cost of risk for the first quarter of 2023 was 75 basis points, and the non-performing loan ratio reached 5.42 percent. The ratio of non-performing loans, including net impaired assets (POCI), reached 6.06 percent. The coverage ratio for cash provisions reached 92.4 percent, while the coverage ratio when collateral was added reached 143 percent.

Ala'a Eraiqat, Group Chief Executive Officer of ADCB, announced that the bank has maintained its growth momentum in 2023, delivering a 27 percent year-on-year increase in net profit to AED 1.878 billion in Q1'23. He stated that this growth momentum reflects the bank's solid balance sheet, prudent risk management, and a resilient UAE economy.

Despite the heightened uncertainty in the global economy and international banking sector, ADCB has achieved record quarterly results. The bank's total assets crossed the AED 500 billion mark during the first quarter for the first time, solidifying its standing as a leading financial institution in the UAE.

In the first quarter, ADCB welcomed over 114,000 new retail customers, with 80 percent joining through digital channels. The bank's cards business, personal and auto loans, and mortgages provided combined asset growth of 11 percent year on year, reflecting positive consumer sentiment and ADCB's ability to remain closely attuned to the market.

Eraiqat added that ADCB's first quarter performance demonstrates its sharp focus on customer service excellence and its strong financial position. The bank remains on a positive growth trajectory and continues to be a highly trusted partner in the UAE economy.

Deepak Khullar, Group Chief Financial Officer, stated that ADCB has continued to maintain strong business and financial fundamentals. In the first quarter, the Bank achieved steady loan and deposit growth, with efficiency metrics in line with their medium-term guidance.

Khullar added that the net interest income of AED 2.851 billion was 33 percent higher than the previous year, while non-interest income was up 34 percent at AED 1.061 billion. Operating profit before impairment allowances rose by 47 percent year on year at AED 2.681 billion.

During the first quarter, ADCB's asset base continued to expand, with net loans increasing by 2 percent sequentially and 7 percent higher year on year. Customer deposits were up 1 percent sequentially and 19 percent higher than a year earlier, with CASA deposits increasing AED 5 billion during the quarter and accounting for 51 percent of the total.

The Bank has continued to take a disciplined approach to managing its cost base in light of the global inflationary environment. In the first quarter, operating expenses reduced by 5 percent sequentially, with the cost to income ratio improving to 31.5 percent from 38.1 percent a year earlier.