Latest news with #banking sector
Khaleej Times
23-07-2025
- Business
- Khaleej Times
Adib posts record Dh4b profit as customer base surges in H1
Abu Dhabi Islamic Bank (Adib) has reported a record net profit before tax of Dh4 billion for the first half of 2025, a 16 per cent increase compared to the same period last year. The strong results reflect broad-based income growth, a surge in new customer acquisitions, and effective execution of a diversified business strategy. Net profit after tax for the six-month period stood at Dh3.5 billion, up 15 per cent year-on-year. The bank's second-quarter performance also mirrored this momentum, with net profit before tax rising 14 per cent to Dh2 billion and net profit after tax climbing to Dh1.8 billion, a 13 per cent annual increase. Adib's return on equity (RoE) reached a robust 29.8 per cent for the first half, approaching a record 30 per cent, reaffirming the bank's leadership in generating shareholder value within the regional banking sector. Total revenues grew by 11 per cent year-on-year to Dh5.9 billion, up from Dh5.3 billion in the first half of 2024. The growth was supported by a balanced contribution from both funded and non-funded income streams. Funded income rose nine per cent to Dh3.6 billion, buoyed by increased business volumes and strategic asset-liability management, which helped mitigate the effects of interest rate cuts introduced in late 2024. Net profit margin stood at 4.27 per cent, highlighting the bank's strong operating efficiency. Non-funded income saw an even more impressive gain, increasing 15 per cent to Dh2.3 billion. This was primarily driven by a 28 per cent jump in fee-generating revenues, which reflected rising customer activity and successful cross-selling across retail and corporate segments. Non-funded income now contributes 39 per cent to Adib's total operating income, highlighting the bank's strategic focus on income diversification. Adib also demonstrated operational efficiency with its cost-to-income ratio improving to 28.2 per cent, down 40 basis points from a year earlier. Operating expenses increased by nine per cent to Dh1.7 billion, mainly due to continued investments in digital infrastructure, technology upgrades, and talent acquisition to support long-term growth. The bank's credit quality improved notably, with impairments down 24 per cent to Dh305 million, resulting in a cost of risk of 44 basis points. The non-performing asset ratio dropped to 3.5 per cent, its lowest level since the fourth quarter of 2016, underscoring successful legacy portfolio remediation and disciplined underwriting. Provision coverage, including collaterals, improved significantly to 160.8 per cent, while excluding collaterals, the ratio rose to 85.3 per cent from 76.9 per cent a year ago. Adib's total assets rose 22 per cent year-on-year to Dh260 billion, driven by strong growth in both retail and corporate financing, as well as an expansion in the bank's investment portfolio. Customer financing surged 23 per cent year-on-year, amounting to Dh31 billion in new credit, while Dh20 billion was added year-to-date, reflecting increased market share across core segments and strategic deals in wholesale banking. Customer deposits grew by 24 per cent to Dh213 billion, compared to Dh172 billion at the end of June 2024. The bank maintained a healthy funding mix, with current and savings accounts (CASA) rising 11 per cent and now accounting for 66 per cent of total deposits. Capital and liquidity positions remained strong, with a Common Equity Tier 1 ratio of 12.69 per cent, a total Capital Adequacy Ratio of 16.56 per cent, and an eligible liquid asset ratio of 17.7 per cent. The advances-to-stable funding ratio was 80.3 per cent. Adib welcomed 145,000 new customers in the first half of the year, reflecting strong demand for its expanding digital offerings and Sharia-compliant financial solutions. Total shareholders' equity grew 13 per cent to Dh29 billion, reinforcing the bank's financial resilience. Jawaan Awaidah Al Khaili, chairman of Adib, said the bank's exceptional first-half performance is a result of record business volumes, continued momentum in customer acquisition, and successful execution of a long-term growth strategy. 'We are focused on building a future-ready bank that integrates technology and delivers long-term value to shareholders,' he said. Group CEO Mohamed Abdelbary added, 'Our disciplined credit approach and high-quality asset origination continue to strengthen our balance sheet. The record earnings show that we are well-positioned to capitalise on the UAE's expanding economy and evolving financial landscape.' He reiterated Adib's commitment to its Vision 2035, aiming to create a resilient, tech-forward Islamic bank that meets future challenges and opportunities head-on.
Times
22-07-2025
- Business
- Times
Rachel Reeves warned that deregulation risks financial crisis
The governor of the Bank of England has warned Rachel Reeves that cutting red tape on the banking sector risks sparking another financial crisis as he downplayed the rise in UK government debt costs. Andrew Bailey told a group of influential MPs on Tuesday that rolling back restrictions on the City and ditching bank ringfencing guidelines could destabilise the UK financial system and 'would not be [a] sensible' decision for the time being. In a near two-hour long session with the Treasury select committee before the parliamentary summer recess, Bailey also said that the rise in long-term government debt costs was not 'unique' to the UK. He said investors were ditching US assets to curb their exposure to the dollar owing to concerns about the economy since President Trump returned to the White House. The governor, who, alongside his role at the central bank, recently took up the chairmanship of the Financial Stability Board, said he could understand why some people would think that 'the financial crisis is now way in the past, we've got past that, that's all solved, that's all out of the way, move on'. However, he said that 'for those of us who were veterans of sorting the problems of [the financial crisis] out' there remained a live threat to financial stability which required lawmakers to retain robust regulations. His comments come after the chancellor told bankers at the annual Mansion House dinner this month that the UK's regulatory regime was a 'boot on the neck' of businesses which risked 'choking [them] off'. Bailey, 66, said he would not have used such phrasing. Reeves announced that the government would reform laws that require lenders to separate their retail and investment banking businesses, a requirement put in place after the 2008 global financial crisis to shield depositors from banks' riskier activities. Several City grandees, including Sir John Vickers, the architect of the ringfencing rules, have expressed concern at the government's deregulation drive, which is intended to reverse weak economic growth. Bailey also downplayed the rise in UK government borrowing costs and said that it was part of a worldwide trend created by Trump's volatile tariff policymaking and a general rise in public deficit spending. 'We've seen an increase in term premium in government bond markets… yield curves have steepened', Bailey said, adding this was 'a global phenomenon, it is not in any sense unique [to the UK]'. The rate on the 30-year UK government bond, or gilt, stands at 5.43 per cent, up from 4.67 per cent compared to a year ago. The yield, which moves inversely to prices, on the US equivalent has risen to 4.93 per cent from 4.48 per cent over the same period. Bailey's comments come as figures from the Office for National Statistics on Tuesday showed that UK debt interest spending jumped to £16.4 billion in June, the second-highest for that month since the records began in 1997. Government borrowing topped £20 billion in the month also, above the Office for Budget Responsibility's projection for the month, strengthening expectations for tax increases at the autumn budget. Trump's erratic decision-making on how much to tax imports from specific countries had led to 'rebalancing' among markets 'which involves a reduction in exposure to dollar assets', Bailey said. The dollar index, which measures the greenback against six comparable currencies, is down nearly 10 per cent since the start of the year. The governor said that, judging by conversations with market participants and based on granular data, 'the most crowded trade in the market at the moment is short dollar'. He said that since Trump first announced his 'reciprocal tariffs' in April, there had been 'a breakdown in established correlations in markets'. Stock markets globally jolted lower in the immediate aftermath of Trump's first tariff announcements, with the S&P 500 index posting one of its largest losses since the Great Depression. However, an equity rally has since pushed several indices to a record high. This week, the FTSE 100 closed at its highest-ever level of just over 9,000 points. Taxes on goods imported to the US from most countries will increase sharply from August 1 after Trump delayed the implementation of his 'reciprocal tariffs' several times.
Arabian Business
17-07-2025
- Business
- Arabian Business
UAE central bank fines foreign bank branch $164,000 for regulatory violations
The Central Bank of the UAE (CBUAE) has imposed a financial sanction of AED 600,000 on a branch of a foreign bank operating in the UAE for failing to comply with regulatory requirements. The penalty was issued pursuant to Article 137 of the Decretal Federal Law No. 14 of 2018 Regarding the Central Bank and Organisation of Financial Institutions and Activities, and its amendments. The financial sanction stems from findings during examinations conducted by the CBUAE, which revealed that the foreign bank branch had failed to comply with the Market Conduct and Consumer Protection Regulations and Standards. The CBUAE stated that through its supervisory and regulatory mandates, it 'works to ensure that all banks and their staff, abide by the UAE laws, regulations and standards adopted by the CBUAE to safeguard the transparency and integrity of the banking sector and the UAE financial system.' The central bank did not identify the specific foreign bank branch that received the penalty. The enforcement action demonstrates the CBUAE's commitment to maintaining regulatory compliance across all banking institutions operating within the UAE's financial system.
