Emirates NBD profit soars 130% on back of interest rate hikes

Reuters/Satish Kumar

• Bank enjoys strongest ever half-year for both income and profit
• Strong growth in lending and current and savings accounts
• Deposits increase by AED53bn in first half of 2023

Net earnings at Dubai’s biggest bank, Emirates NBD, rose by 77.14 percent in the second quarter of 2023 as net interest income surged due to a buoyant regional economy.

The bank reported a net profit of AED6.2 billion ($1.69 billion) for the April to June period compared to AED3.5 billion a year earlier.

Net profit jumped 130 percent to a record high of AED12.3 billion in the first half of 2023 on strong current and savings accounts growth and increased lending.

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The Dubai-listed bank saw deposits rise by AED53 billion in H1 2023, including AED37 billion of low-cost current and savings accounts.

Patrick Sullivan, group chief financial officer, Emirates NBD, stated that all business units generated a substantial increase in income, helping deliver the strongest ever half-year for both income and profit.

“The group’s success in growing an inexpensive and diversified funding base has positioned the bank to continue benefiting from higher interest rates,” he said, adding impairment allowances fell substantially, with a 50 percent year-on-year improvement.

The bank’s balance sheet surpassed the AED800 billion milestone for the first time, as earnings per share rose significantly by 138 percent to 190 fils.

“We are committed to playing a key role in driving further economic growth and development across the region,” said vice chairman and managing director Hesham Abdulla Al Qassim.

Record retail lending and success in closing key corporate lending deals across the region drove loan growth five percent higher, underlining the strength of the bank’s regional presence, added group CEO Shayne Nelson.

Earlier Emirates NBD Research revised its forecast for UAE growth in 2023 to 2.9 percent from 3.2 percent on the expectation of a contraction in hydrocarbon GDP.

However, the forecast for UAE non-oil GDP growth was revised up to five percent this year, from 3.5 percent previously.