The Board of Directors of NBAD discussed today the first half results, and reported net profits of Dh1,876 billion for the first half of 2008, 58% above the 1st half of 2007. Annualised earnings per share were Dh1.92 up from Dh1.24 in the comparable period of 2007. The return on equity was 30.1%, above the Bank’s medium term strategic plan return of 25%. In the second quarter the Bank set two records for quarterly profit and total assets. For the second quarter, net profits at Dh1,002 million were up 72% on the corresponding quarter of 2007 and total assets reached Dh165 billion up 33% on the same period in 2007. Compared to the same period end in 2007, loans increased 63% to Dh106 billion reflecting, in particular, the demand in Abu Dhabi to finance the substantial growth in the Emirate. Customer deposits were up 15% to Dh89 billion. Cash and balances with Central Banks reached Dh24.6 billion, reflecting the Bank’s dirham liquidity position. Capital resources, including Dh3.1 billion of subordinated convertible notes, reached Dh16.7 billion, up 38% from the corresponding period in 2007. Operating income for the 1st half of 2008 was up 61% to Dh2.7 billion including non-interest income of Dh1.1 billion, almost 95% up on the corresponding period in 2007 and reflecting the concentration on diversifying our fee earning sources. Operating expense growth of 44% reflects the planned and continued investment in expanding our network, enhancing our infrastructure, upgrading our systems and our people. To demonstrate our commitment to our valuable human resources, the Bank introduced an employee share option scheme. The cost income ratio of 25% in the 1st half of 2008 compares favourably with 28% in the comparable period of 2007, and is well within our medium term cap of 35%. Domestic banking business was the biggest contributor to the Group’s operating profits at 50% with International business, Financial Markets and other businesses contributing 15%, 25% and 3% respectively. Islamic and Private banking businesses are progressing on plan and our real estate subsidiary is expected to commence formal operations in the 4th quarter of this year. Head office, which is run as a business, contributed 7%. The Financial Markets business has enjoyed an outstanding first half with profits up 352% on the 2007 comparable. Total new provisions in the 2nd quarter were Dh104 million of which Dh69 million was new collective impairment provisions mirroring the growth in our loan portfolio and our relatively conservative credit strategy. Recoveries and writebacks were Dh31 million. Impaired loans, as at 30 June 2008 were Dh867 million, 116% covered by provisions reflecting our strong asset quality. NBAD has one of the highest credit ratings in the region comparable with many medium sized European banks. We were the first national bank in the UAE to provide custody service to local and international investors in UAE. Michael H. Tomalin, NBAD’s Chief Executive said: "The outstanding first half results reflect the strong performance of all the bank’s businesses. NBAD is well positioned to play its part in the on-going Abu Dhabi and UAE growth story.”

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