Emirates NBD Reports AED2.6 Billion Net Profit In 2012

Emirates NBD today announced its net profit for 2012 increased by 3 per cent to AED 2.6 billion compared with AED 2.5 billion in 2011, and up 281 per cent after excluding the AED 1.8 billion non-recurring gain on subsidiaries reported in 2011.

It added that the cash dividend of 25 per cent per share was declared for 2012, while the total income stood at AED 10.2 billion last year, up 3 per cent from 2011.

Commenting on the Group’s performance, H. H. Sheikh Ahmed bin Saeed Al Maktoum, Chairman of Emirates NBD said: "These financial results reflect a very positive operational performance and demonstrate the strength of Emirates NBD and its position as a leading bank in the region. Despite the challenges reflected in the broader global economic environment, the UAE and Dubai in particular have shown resilience and solid growth during the year and Emirates NBD is well-placed to continue to capitalise on this improving economic backdrop." He added, "in light of the Bank’s successful performance in 2012, an improving outlook, and in line with our commitment to shareholders, the Bank has declared a cash dividend of 25 per cent per share for the 2012 financial year." Emirates NBD’s Chief Executive Officer, Rick Pudner, said: "During 2012 Emirates NBD has delivered a strong set of financial results with operating profits for the year up 82 per cent. The year has also witnessed successful execution towards our strategic imperatives, with highlights including the completion of the Dubai Bank integration, the progress made in our Wholesale Banking transformation program and the improving growth momentum in our retail and Islamic franchises. This strategic progress, in combination with our strong levels of capitalisation and liquidity, positions the Bank to take advantage of growth opportunities in the future." Emirates NBD’s Chief Financial Officer, Surya Subramanian, said: "The Bank has continued to deliver strong levels of operating profitability during 2012 with top-line growth supported by an improving underlying operating cost position and a gradually declining risk cost. The year has also seen a sustained focus on balance sheet optimisation resulting in strong growth in stable low-cost deposits and the issuance of almost AED 15 billion in medium term liabilities." Total income for the year ended 31 December 2012 amounted to AED 10,212 million, an increase of 3 per cent compared with AED 9,930 million in 2011. Total income for Q4 2012 increased by 1 per cent from Q4 2011 to AED 2,506 million.

Net interest income for the year ended 31 December 2012 declined by 5 per cent to AED 6,912 million from AED 7,258 million in 2011. On a quarterly basis, Q4 2012 net interest income of AED 1,766 million declined by 8 per cent from Q4 2011. The declining trends in net interest income were attributable to net interest margin compression in 2012 to 2.43 per cent from 2.69 per cent in the previous year resulting from lower loan spreads and the impact of increased wholesale debt funding.

Non-interest income recorded an improvement of 24 per cent to AED 3,300 million for 2012, driven principally by higher investment securities income and lower write-downs on investment properties. Excluding these impacts, core fee income improved by 9 per cent resulting from increased banking fee income and a pickup in trade finance activity.

Costs for the year ended 31 December 2012 amounted to AED 3,669 million, an increase of 5 per cent over 2011 resulting from the consolidation of Dubai Bank costs from Q4 2011. Excluding the impact of Dubai Bank, operating costs improved by 1 per cent in 2012 due to cost optimisation initiatives.

Emirate:  Dubai

Date: Jan 31, 2013

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