Dubai’s Emirates NBD posts 65% rise in 2023 earnings

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Emirates NBD, Dubai’s biggest lender by assets, reported a 65 per cent increase in full-year profit, supported by asset growth, a low-cost funding base and higher transaction volumes.

The bank’s net profit came in at about $5.9bn (Dhs21.5bn), up 65 per cent year-on-year (YoY) from Dhs13bn a year ago.

Quarterly, Emirates NBD said its net profit rose by 3 per cent to reach Dhs4bn on higher income reflecting a buoyant regional economy.

The Dubai-based lender proposed a dividend of 120 fils per share for last year, doubling the amount paid to shareholders in 2022.

“With the UAE’s economy thriving, and the nation an attractive destination for ultra-high-net-worth individuals from across the world, Emirates NBD competently caters to all sectors of the wealth spectrum,” the bank’s CEO Shayne Nelson said in a statement.

Banks in the GCC region have benefited from higher interest rates in the wake of the US Federal Reserve’s moves to increase borrowing costs to combat inflation.

Moody’s projected in its global outlook that GCC banks’ profitability will remain strong, supported by low provisioning requirements and high margins.

Emirates NBD’s full-year revenues jumped 32 per cent to Dhs43bn, helped by growth in loans as well as fees and commissions.

The banking group’s assets edged up to Dhs863bn in 2023, a 16 per cent increase from Dhs742bn a year earlier while gross loans and deposits rose by per cent and 16 per cent, respectively.

Emirates NBD grows global footprint

With a market capitalisation of Dhs116.2bn as of January 26, 2024, Emirates NBD expanded its network in Saudi Arabia to 15 branches and enhanced its global footprint and digital capabilities to drive further growth.

Outside the UAE, Emirates NBD’s retail lending in Saudi Arabia rose 27 per cent from the previous year and the bank plans to increase the number of branches there to 24.

Meanwhile, Emirates Islamic Bank, the Islamic banking arm of Emirates NBD, posted a 71 per cent surge in annual profit to Dhs2.12bn – the highest ever.

The Islamic lender’s full-year operating income came in at Dhs4.77bn, up 50 per cent from Dhs3.2bn in 2022, with a total net impairment loss for the year of Dhs873m compared to Dhs403m a year earlier.

“Emirates Islamic’s gross financing increased in 2023, including improved productivity and return on assets,” said Farid Al Mulla, CEO of Emirates Islamic.

The bank’s total assets jumped by 18 per cent to Dhs88bn during the year, with customer financing growing by 11 per cent to Dhs53.7bn.

Read: DIB’s full-year profit surges to Dhs7bn on higher interest income