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Emirates NBD’s profits for the year 2022 jumped 40%, to reach 13 billion dirhams. Profit for the fourth quarter was exceptionally strong at AED 3.9 billion, up 94% compared to the same period in the previous year.
2022 was a record year in terms of performance, especially in terms of retail loans and customer transactions, with all business units showing outstanding performance.
New corporate loans also grew by 50 billion dirhams in 2022, which reflects the continued positive outlook and the level of optimism that prevails in the business sector, in addition to the growth in current and savings account balances by 20 billion dirhams, and the improvement of the deposit mix, supported by the strong liquidity of the sector.
Credit quality remains good, demonstrating the strength of the economy in the region with the impairment rate declining by 12%. The bank opened new branches in Saudi Arabia, Egypt and India with the aim of accelerating the pace of investment in its international presence and digital capabilities to support future growth opportunities.
Support for Agenda D33
His Highness Sheikh Ahmed bin Saeed Al Maktoum, Chairman of the Board of Directors of Emirates NBD Bank, said: The jump in the bank’s profits reflects the strong regional economic growth and the success of the diversified business model of the group. As a leading bank in the region, we are proud to support Dubai’s D33 economic agenda, which aims to double the size of Dubai’s economy over the next ten years and enhance its position among the top three international destinations for tourism and business.
His Highness added: The bank played a leading role in supporting the subscription to initial public offerings, amounting to 31.1 billion dirhams in 2022, so that the bank, in turn, contributes to the development of Dubai’s economy and capital markets.
He said that our focus on long-term succession plans led to the appointment of Emirati talents to senior leadership positions, and I feel very proud that 70% of the members of the executive management team of the group in the UAE are citizens of the country.
His Highness indicated that in light of the strong performance of the group, we propose an increase of 20% in cash dividends to reach 60 fils per share.
For his part, Hisham Abdullah Al-Qassem, Vice Chairman and Managing Director of the Group, said: International operations provide opportunities for diversification and growth, as they contribute to 39% of total income. Earlier this month, we became the first bank to issue public bonds in dirhams following the UAE Federal Government’s construction of the yield curve in dirhams, reinforcing our national identity. The group expanded its international economic ties by opening more branches in Saudi Arabia, India and Egypt.
Strong growth ulcer
Shayne Nelson, Group CEO, said: We are pleased to have been able to maintain strong income growth momentum as well as strict cost control and benefited from re-entries and refunds, which reflects the healthy regional economic situation.
He emphasized that liquidity in the UAE banking sector remains in good condition, and the balances of current and savings accounts grew by 20 billion dirhams during 2022, which enabled the group to benefit from higher interest rates.
He pointed out that in conjunction with the bank’s celebration of the sixtieth anniversary of its founding in 2023, we have reconfigured our leadership team, including the due appointment of a number of Emirati executives, the appointment of the group’s head of environmental, social and corporate governance, and the establishment of a venture capital fund for companies to take advantage of future growth opportunities. He said that Dubai’s economy is expected to achieve strong growth in 2023, and the group’s strong balance sheet today is in a position to support our customers and help them grow both locally and internationally.
Emirates Islamic’s net profit jumped to a record 1.24 billion. Denizbank’s income also increased by 50%. Total income increased by 36% to reach 32.5 billion dirhams. The net interest margin increased to 3.43%, and the guidelines for 2023 indicate that it will be higher on the back of a further rise in interest rates.
A strong performance was recorded in the activities of individual loans and Islamic financing, which was accompanied by the provision of new loans to companies in the amount of 50 billion, which was matched by the repayment of large amounts of government loans. Current and savings accounts grew by 20 billion dirhams in 2022.
Earnings per share increased remarkably by 43% to reach 198 fils, which constitutes a fundamental increase of 79%, and total assets increased by 8% to reach 742 billion.
Impairment provisions decreased significantly by 12% compared to the same period in the previous year. Emirates NBD and Emirates Islamic have a market share of around 30% of debit and credit card spending in the UAE, with more than 1 million transactions processed per day.
The bank launched the developed mobile banking application ENBD X, and a 100% cloud-native IT infrastructure was completed and installed. 97% of all sales and service transactions are fully automated. Liv.. became the first new digital bank in the country to provide customers with a platform to subscribe to the initial public offering. The payment service (Emirates NBD Pay) was launched.
Successful long-term succession planning has resulted in 70% of the group’s current executive management team members in the UAE being nationals. A Group Head of Environmental, Community and Corporate Governance was appointed, and community service contributions doubled to reach 116 million in 2022.
The outlook for the Middle East remains positive despite the slowdown in global economic performance. The rise in oil prices in 2022 had a prominent role in giving impetus to the budgets of the Gulf Cooperation Council countries and achieving a surplus, and it also strengthened government balance sheets.
The bank’s research unit expects the UAE’s GDP to grow by 3.9% in 2023, far exceeding the World Bank’s global growth forecast of 1.7%. Inflation has begun to decline in many economies, coinciding with market expectations that interest rates will peak.
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