Emirates NBD Q1 profits fall 24% on coronavirus impairment surge

Dubai’s largest lender Emirates NBD said its first-quarter net profit declined 24 percent on higher provisions the bank took in anticipation of the impact of the new coronavirus outbreak. (Emirates NBD Facebook)
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Updated 20 April 2020

Emirates NBD Q1 profits fall 24% on coronavirus impairment surge

  • Banks in the UAE are feeling the impact of measures aimed at containing the coronavirus outbreak

DUBAI: Dubai’s largest lender Emirates NBD said on Monday first-quarter net profit declined 24 percent year-on-year due to higher provisions the bank took in anticipation of the impact of the new coronavirus outbreak on credit conditions.
The bank posted a net profit of $566.29 million (Dh2.08 billion) in the quarter, down from $742 million (Dh2.74 billion) in the same period a year earlier. On a quarterly basis, however, net profit improved by 3 percent.
“Net operating profit declined 24 percent y-o-y as the group took additional impairment allowances to increase coverage in anticipation of a deterioration in credit quality in subsequent quarters,” Patrick Sullivan, the group chief financial officer, said in a statement.
Banks in the United Arab Emirates are feeling the impact of measures aimed at containing the outbreak, which have brought parts of the economy such as tourism and transport to a near halt.
“Regional banks face multiple challenges from low interest rates, low oil prices and lower economic growth due to disruption from COVID-19,” said Sullivan.
The operating performance of the bank was good prior to the emergence of the economic impact of COVID-19, he said.
The bank increased impairment allowances to $561.3 million, with an increase in the annualized net cost of risk of 210 basis points.
Its non-performing loan ratio was stable at 5.5 percent in the quarter, and total assets increased by 1 percent from the end of 2019 to $191.16 billion.
“Emirates NBD has a good underlying operating performance, coupled with a robust balance sheet to help navigate these challenges. The group continues to operate with strong liquidity and healthy capital ratios,” Sullivan said.

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Iran: Oil product exports hit record high despite US sanctions

Updated 22 January 2021

Iran: Oil product exports hit record high despite US sanctions

  • ‘The enemy and Trump wanted us to perish and die, our exports to reach zero’
  • ‘We set the highest record of exports in the history of the oil industry during the embargo period’

DUBAI: Iran has achieved record high exports of petroleum products despite US sanctions, Oil Minister Bijan Zanganeh said in televised remarks on Friday.
Zanganeh said former US President Donald Trump and his secretary of state, Mike Pompeo, had “joined the dustbin of history, but we are alive and working with more hope to build the country.”
“The enemy and Trump wanted us to perish and die, our exports to reach zero,” he said.
“We set the highest record of exports in the history of the oil industry during the embargo period.”
Trump abandoned the Iran nuclear deal in 2018 and imposed sanctions on the Iranian energy and banking sector.
It is estimated that Iran exports less than 300,000 barrels of oil per day (bpd), compared with a peak of 2.8 million bpd in 2018.
US President Joe Biden has said that if Iran resumed strict compliance with the nuclear agreement — under which it restrained its nuclear program in return for relief from economic sanctions — the United States would too.
However, two of Biden’s top national security nominees said on Tuesday that the United States was a long way from making a decision to rejoin the deal.
Iran has significantly increased exports of petroleum products in recent years although oil products, like crude, fall under US sanctions.
Unlike crude oil, where the ultimate buyer is a refinery, other products can find their way to potentially thousands of small-scale industrial or residential buyers, making them difficult to trace.