Around 900 jobs cut in Abu Dhabi’s banking sector

31/05/2017 02:17 AST

Nearly 900 jobs were cut across the banking sector in Abu Dhabi over the past year, with the number of employees in the sector dropping to 12,500 in the first quarter of 2017. According to a report from the Statistics Centre Abu Dhabi (Scad) on Tuesday, the sector saw a 6.9 per cent year-on-year decline in the number of employees compared to the 13,400 employees working in it in the first quarter of 2016.

Scad said the figures were for all commercial and Islamic banks it studied in Abu Dhabi. The bank did not say that every bank in Abu Dhabi was included in the study.

The decline comes amid a slowdown in the banking sector, especially during 2016, with many publicly-listed banks reporting lower year-on-year profit growth and some reporting a decline in profitability. The banks’ financial statements showed the decline was supported by higher impairment charges and slower loan growth. This is amid slower economic growth in the UAE, with data from the International Monetary Fund forecasting a 1.3 per cent growth rate in the country’s gross domestic product in 2017 compared to 2.7 per cent in 2016.

The drop also comes amid consolidation in the sector, with two of Abu Dhabi’s largest banks having merged as of the beginning of April 2017.

Earlier reports had suggested that the merger between the National Bank of Abu Dhabi and First Gulf Bank (which created the new entity named First Abu Dhabi Bank) would result in a total loss of around 2,000 jobs. The figure was never confirmed by either bank, however, with spokespeople from the banks calling them exaggerated.

Elsewhere, Abu Dhabi Islamic Bank cut around 364 jobs across the UAE between the first quarters of 2016 and 2017, according to Gulf News calculations based on the bank’s management report for the quarter. The report did not include how many of those 364 jobs were in Abu Dhabi.

In its analysis, the Statistics Centre also said that banks in Abu Dhabi collectively recorded Dh7.7 billion in net income in the first quarter of 2017. Nearly 82.6 per cent of that income was earned by commercial banks, while the remaining 17.4 per cent went to Islamic banks.

Gulfnews