Abu Dhabi Commercial Bank PJSC today released its Q1-2019 financial results, reporting strong operating performance underpinned by robust growth in gross interest and Islamic financing income and non-interest income.

In a statement Monday, the bank said its results are for the standalone ADCB entity for the first quarter of 2019, prior to the merger with Union National Bank and the subsequent acquisition of Al Hilal Bank.

The bank report a net profit of AED 1.152 billion 5 percent lower, impacted by higher cost of funds, partially offset by higher non-interest income and lower impairment charges.

Gross interest and Islamic financing income of AED 3.116 billion was up 17 percent, with net interest and Islamic financing income standing at AED1.707 billion, a 7 percent lower, primarily attributable to a change in the composition of the liability base over Q1’18 and competitive pricing, partially offset by rising benchmark rates and higher volumes Total assets grew 4 percent to AED 292 billion and net loans to customers increased 2 percent to AED 169 billion over 31 December 2018.

Deposits from customers increased 4 percent to AED 184 billion over 31 December 2018, with loan to deposit ratio improved to 91.7 percent from 94.2 percent as at 31 December 2018.

The bank affirmed a strong capital and liquidity position, with capital adequacy ratio (Basel III) of 15.76 percent and common equity tier 1 (CET1) ratio of 12.0 percent compared to minimum capital requirements of 13.50 percent and 10.00 percent (including buffers) respectively prescribed by the UAE Central Bank.

Commenting on the Bank’s performance, Ala’a Eraiqat, Group Chief Executive Officer and Board Member, said: "Following our strong results in 2018, we are pleased to announce a net profit of AED 1.152 billion in Q1’19. We have made good progress in a number of key areas in the first quarter of 2019. In particular, we have delivered a strong and sustainable return on equity, increased fee income and continued to grow our market share in deposits. In a rising interest rate environment, our low cost CASA deposits grew by AED 10 billion to AED80 billion, reporting an increase of 15 percent over the year end."

He added that the Bank maintains a robust risk governance structure. "Our prudent approach to risk management has given us the flexibility to adjust to the challenges of the operating environment in an increasingly competitive market. We remain committed to preserving and protecting the long-term financial strength of the Bank and continue to place high priority on maintaining adequate sources of funding and liquidity.

"Fast-paced changes in technology continue to impact customers’ expectations and behaviour, and the Bank’s strategy is evolving in parallel to maintain our position as a progressive player. We have sustained our investment in digital transformation, with key initiatives such as the recent launch of the "Hayyak" onboarding app for new customers, which offers instant account opening."

Commenting on the new merger, Eraiqat said, "I am also pleased to announce that the combination of ADCB with UNB and Al Hilal Bank has taken effect, and we are already making rapid progress in integrating the three organisations. Looking ahead to the future of the Bank, our priorities are to maintain the highest standards of customer service throughout the integration, while delivering cost synergies and sustainable long-term growth."

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