Abu Dhabi Commercial profits 2.8 billion in 9 months – the...

Abu Dhabi Commercial profits 2.8 billion in 9 months – the...
Abu Dhabi Commercial profits 2.8 billion in 9 months – the...

Abu Dhabi Commercial Bank announced yesterday its financial results for the nine months of 2020 and is based on the initial financial statements of the merging entity after the completion of the merger between Abu Dhabi Commercial and the National Union and the acquisition of Al Hilal Bank on May 1, 2019.

As the net profit amounted to 1.366 billion dirhams for the third quarter, an increase of 11% over what it was in the second quarter and a decrease of 3% compared to the same period last year, which constitutes a return on equity of 12%, and the bank recorded a net profit of 2.802 billion dirhams for the first nine months compared to 4.196 billion over the same period last year.

Income from operations increased 2% to reach 2.991 billion dirhams in the third quarter of 2020. Non-interest income increased by 19% compared to the second quarter of this year to reach 706 million dirhams, and net income from fees and commissions increased by 21%, which partially compensated for the 3% decrease in Net income from interest and Islamic financing operations, which amounted to AED 2.285 billion.

Provision growth

Total provisions in the third quarter amounted to 913 million dirhams, an increase of 18% over the second quarter of 2020, as a result of adopting a conservative approach to provisioning.

Net provisions in the third quarter of this year amounted to 504 million dirhams, down 25% from what they were in the second quarter, as a result of recovering bad loans and issuing previous provisions. The bank recorded additional allocations in the third quarter of 2020 amounting to 148 million dirhams related to the loans of the «NMC Group Healthcare and Finablr and their subsidiaries, with total allocations amounting to 1.379 billion dirhams.

Savings of 231 million dirhams were achieved in the third quarter and about 642 million dirhams by the end of the nine months of 2020, and the bank continues to strive to achieve savings of 750 million dirhams by the end of the year, and to achieve full savings targeted by the end of 2021, amounting to 1 billion dirhams.

The bank adopted a package of comprehensive measures to alleviate the impact of the current economic burdens on customers in line with the comprehensive support plan set by the Central Bank. The package included delaying loan installments, reducing fees and prices, reducing interest rates, exempting some fees and rescheduling working capital facilities for small and medium enterprises and companies.

Alaa Erekat, CEO and Board Member of Abu Dhabi Commercial Group, said: “The bank continued to maintain its strong performance and succeeded in adapting to the current operational conditions and challenges. The highest priority for the bank at the present time is to build a solid base that qualifies us to move forward in the future growth process.”

During the third quarter, the group achieved a net profit of 1.366 billion dirhams, which constitutes a rewarding return on equity of 12.0%. .

Among the striking developments that we have witnessed during the past months is the increasing demand for our digital platforms, with the growth in the rate of our customers’ dependence on these solutions significantly, even after the easing of the closure procedures in the UAE, and the number of users registered in the bank’s digital banking services platforms via the Internet and smartphones increased by 18% Compared with the same period in 2019 to about 800,000 users.

Decisive measures

Deepak Kohler, Chief Financial Officer of Abu Dhabi Commercial Group, said: “In light of the economic challenges facing the markets, the group is taking decisive measures to preserve profitability and protect its strong financial position in the long run while ensuring continuity of providing excellent services to customers.

He explained that the results of the third quarter reflect the bank’s ability to adapt and achieve strong performance, as the bank recorded an increase in income from operations of 2% compared to the second quarter of this year to 2.991 billion dirhams.

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