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Al Etihad
2 days ago
- Business
- Al Etihad
UAE banks put up a strong show in Q1 2025
11 June 2025 22:06 MAYS IBRAHIM (ABU DHABI)UAE banks kicked off 2025 on a strong note, posting an 8.4% quarter-on-quarter (QoQ) increase in aggregate net income to Dh22.2 billion, according to Alvarez & Marsal (A&M) latest UAE Banking Pulse report for Q1 surge was attributed to a 59.3% QoQ reduction in impairment charges and an 18% rise in net fee and commission report, which tracks the performance of the UAE's ten largest listed banks, indicates that the first quarter was marked by enhanced cost efficiency, a rise in non-interest income, and renewed momentum in mergers and acquisitions a 2.1% dip in net interest income (NII), profitability ratios showed improvement: Return on equity (RoE) rose to 18.6%, while return on assets (RoA) increased to 2.1%.Lending activity also gained traction, with net loans and advances rising 3.6% QoQ, driven largely by corporate and wholesale lending, which saw a 5.1% grew at an even faster pace, climbing 5.8% due to a 7.6% jump in current and savings account (CASA) inflows. As a result, the loan-to-deposit ratio (LDR) declined to 74.7%, signalling improved sector discipline and digital transformation efforts further strengthened banks' performance. Operating expenses dropped by 7.8% QoQ, pushing the cost-to-income (C/I) ratio down by 234 basis points to 28.2% – the lowest level in the past efficiency gains contributed meaningfully to overall profitability, even as topline revenue remained mostly quality also showed significant improvement. The cost of risk (CoR) fell by 45 basis points to 0.29%, while the coverage ratio rose to 110.5%.The non-performing loan (NPL) ratio declined to 3.2%, supported by stronger recoveries and a healthier loan book. Stage 1 loans increased 3.9% QoQ, while Stage 2 and 3 exposures key trends in Q1 include deposits mobilisation outpacing credit growth. Aggregate deposits grew by 5.8% QoQ, driven by a 7.6% QoQ increase in CASA deposits, exceeding loan growth of 3.6% QoQ. As a result, the Loan-to-Deposit Ratio (LDR) declined 1.5 percentage points to 74.7%.Operating income remained broadly flat, declining marginally by 0.2% QoQ. Net interest income decreased by 2.1%, while fee and commission income rose sharply by 18%, partially offsetting pressure from interest interest margin (NIM) compressed by 15bps QoQ to 2.52% due to lower yield on credit, which dropped by 99 basis points QoQ to 10.9% amid ongoing rate cuts. Cost of funds improved by 52 basis points QoQ to 3.9%, offering some margin protection. The banks analysed in the report are First Abu Dhabi Bank (FAB), Emirates NBD (ENBD), Abu Dhabi Commercial Bank (ADCB), Dubai Islamic Bank (DIB), Mashreq Bank (Mashreq), Abu Dhabi Islamic Bank (ADIB), Commercial Bank of Dubai (CBD), National Bank of Fujairah (NBF), National Bank of Ras Al Khaimah (RAK) and Sharjah Islamic Bank (SIB).
Arabian Business
31-03-2025
- Business
- Arabian Business
Commercial Bank of Dubai
Commercial Bank of Dubai The facility will enable Siemens's UAE unit to execute its expanding pipeline of projects and drive future growth Commercial Bank of Dubai The deal will provide financial agility to key development projects, including the much-anticipated Mina Al Arab Arif Amiri The six-month programme includes banks, fintech players, regulators and the industry with the potential to unlock the next wave of growth for the sector Buy now Pay later CBD and buy now, pay later provider Postpay team up on new debt financing arrangement Commercial Bank of Dubai Shari'a compliant real estate investment trust agrees facility with Emirates NBD and Commercial Bank of Dubai buy now pay later scheme As the world went into lockdown last year at the onset of the coronavirus pandemic, a great number of people turned to online shopping, whether for necessity or leisure Ajman Bank PJSC Islamic syndication facility attracted more than 75% oversubscription and was fully subscribed by 12 banks Accion Venture Lab Now Money receives $7m boost as it seeks to launch operations in Saudi Arabia Abu Dhabi Commercial Bank New research says UAE banks are generating healthy earnings despite tougher economic conditions in Q1 bank merger More than 20 Gulf financial institutions with total assets exceeding $1 trillion are said to be in merger talks Abu Dhabi Commercial Bank Alvarez & Marsal releases latest UAE Banking Pulse report on performance of 10 largest listed banks in the UAE Abraaj A growing number of companies have declared that they have direct or indirect exposure to the troubled private equity firm. CBD Brand View: Khaled Rasheed Al Hamadi has more than 20 years of experience in the financial industry
