Lower revenues, higher provisions hit National Bank of Abu Dhabi profi

27/01/2016 16:20 AST

National Bank of Abu Dhabi , the United Arab Emirates's largest lender by assets, reported a 24.5 percent drop in fourth-quarter net profit on Wednesday, hit by higher provisions and lower revenues.

The bank, or NBAD, made a net profit of 1.04 billion dirhams ($282.1 million) in the three months to Dec. 31, down from 1.37 billion dirhams in the same period a year earlier. It is almost 70 percent owned by an Abu Dhabi state investment fund.

For 2015, the bank said net profit was 5.23 billion dirhams, down 6.2 percent from 2014.

The bank was one of three United Arab Emirates' lenders to report fourth quarter earnings on a day of contrasting fortunes. Mashreq, Dubai's third-biggest bank by assets, posted a 13.7 percent fall in net profit, while Dubai Islamic Bank , the United Arab Emirates' largest sharia-compliant lender, posted a 62.8 percent increase in net profit.

NBAD's fourth quarter revenues fell to 2.56 billion dirhams versus 2.76 billion dirhams in the prior-year period, while write-downs in the quarter more than doubled to 436 million dirhams compared with 200 million dirhams a year earlier.

"Through conservative provisioning and by building up a strong capital buffer we have ensured the bank is on solid footing for the year ahead," Alex Thursby, chief executive of NBAD said in the statement. "We remain confident and conservative in 2016."

Loans totalled 205.9 billion dirhams at the end of 2015, up 6 percent year on year, while total deposits fell 3.9 percent to 233.8 billion dirhams in the same period.

The board proposed a cash dividend of 0.4 dirhams per share for the year 2015. The cash figure is the same as the payout in 2014, although the previous year also had a 10 percent stock dividend.

The board also approved plans for a $2 billion medium term notes programme, it said in a separate statement. ($1 = 3.6726 UAE dirham)

Reuters