Abu Dhabi Commercial Bank (ADCB), the UAE’s third largest lender by market value, posted a 40 per cent rise in fourth-quarter net profit on Sunday, beating analysts’ forecasts, as impairment allowances more than halved.
ADCB, nearly 60 per cent owned by the Abu Dhabi government, reported a net profit of Dhs879 million ($239.5 million) for the three months to December 31, it said in a statement. That compares with a profit of Dhs628 million in the prior-year period.
Five analysts polled by Reuters had estimated an average fourth quarter profit of Dhs783.50 million for the quarter.
Banks in the United Arab Emirates have reported strong growth in arnings in recent quarters thanks to an overall recovery in the Gulf state’s economy and lower provisions arising from a reduction in problem loans.
ADCB is the first major lender in Abu Dhabi to announce 2013 results. Profit for full year 2013 was Dhs3.37 billion compared with Dhs2.74 billion in 2012.
Loan impairment allowances – the amount of money set aside to meet loan losses – dropped sharply to Dhs198 million in the fourth-quarter compared to Dhs402 million in the year ago period, ADCB said.
The bank proposed a dividend of 30 fils per share, a 50 per cent increase to what it paid last year, if the five fils per share special dividend paid in 2012 was excluded, the statement said.
Loans and advances grew to Dhs131.64 billion in 2013, up seven per cent over the previous year, while customer deposits advanced six per cent to Dhs115.42 billion last year.
The lender sold a $500 million three-year floating rate bond in the fourth-quarter last year.
ADCB shares did not trade on the Abu Dhabi bourse Sunday. The stock is up 100 per cent in the last one year, according to Thomson Reuters data.