Abu Dhabi Commercial net profit of 1.121 billion dirhams in the first quarter

Abu Dhabi Commercial Bank's net profit amounted to 1.121 billion dirhams for the first quarter of 2021, an increase of 436% compared to the first quarter of 2020 and an increase of 11% compared to the fourth quarter of last year.

The bank said in a statement today, during which it announced its financial results for the first quarter of this year, that net interest income amounted to 2.119 billion dirhams, a decrease of 10% compared to the last quarter of last year and a decrease of 24% compared to the first quarter of last year.

This was mainly due to the decline in interest rates and the prevailing economic conditions in the markets.

This was partially compensated for by the increase in non-interest income, which reached 802 million dirhams, up by 14% compared to the fourth quarter of last year and by 17% compared to the first quarter of last year.

Operating expenses decreased by 20% compared to the first quarter of last year and by 1% compared to the last quarter of last year to reach 1.061 billion dirhams, and the cost to income ratio reached 36.3% in the first quarter of 2021, meaning that it recorded an improvement of 180 basis points compared to the same period of last year. Last year, as a result of achieving savings from merger (Merger Synergies), taking advantage of the levels of efficiency provided by the digital banking transformation program, in addition to applying additional measures to control costs.

The bank is moving forward in its quest to pass the savings target (Synergy) by the end of 2021 of 1 billion dirhams, as it has already achieved savings of 917 million dirhams by the end of 2020.

The bank continues its commitment to the conservative approach in setting aside provisions, as net provisions reached 704 million dirhams in the first quarter of 2021, a 25% decrease compared to the last quarter of last year and a 63% decrease from the exceptional first quarter of last year.

Customer deposits in current and savings accounts increased by 10.5 billion dirhams during the first quarter of 2021 to reach 138 billion dirhams, accounting for 58% of total customer deposits, compared to 51% at the end of last year.

Total customer deposits decreased by 5% compared to the fourth quarter of last year to reach AED 239 billion as of March 31, 2021. This is due to the bank's exit from high-cost term deposits.

Net loans and advances amounted to 236 billion dirhams as of March 31, 2021, a decrease of 1% compared to the last quarter of last year, as a result of the repayment of corporate loans in the real estate sector in addition to allocating provisions, while the average balance of loans and advances reached 233 billion dirhams during the first quarter of 2021. .

Payments made to customers who benefited from the comprehensive economic support plan launched by the Central Bank of the United Arab Emirates totaled AED 6.716 billion.

Shareholders' equity reached 56 billion dirhams as of March 31, 2021.

The non-performing loan ratio was 6.5% and the cash provisions coverage ratio was 88%, while the coverage rate upon adding guarantees was 139% as of March 31, 2021.

Abu Dhabi Commercial Bank Group CEO Alaa Erekat said: “Abu Dhabi Commercial Bank made a strong start at the beginning of the year, as net profits for the first quarter of 2021 increased by 11% to reach 1.121 billion dirhams compared to the last quarter of last year. This significant growth is mainly due to an improvement in the cost of risk compared to the first quarter of last year. "

He added: “These results came to reflect the well-established institutional foundations of the bank and the ability of the retail banking group and the corporate banking group to adapt and maintain its leading role in the markets, as was the savings achieved from the merger (Merger Synergies), the acceleration of the transition to digital banking, and the launch of initiatives. The incremental cost control has a positive effect on the efficiency of all our operations. "

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