First Abu Dhabi Bank Revenue Grows 16% Y-o-Y in H1-24

Underlining its consistent growth trajectory, the UAE-based First Abu Dhabi Bank (FAB) has posted a net profit of $2.29 billion, a revenue of $4.27 billion (+16% y-o-y), while profit before tax grew 15% y-o-y $2.72 billion.

The second quarter net profit was $1.17 billion, and operating income was $2.12 billion (+14% y-o-y), FAB said announcing the financial results for the first six months of 2024 on Thursday.

The bank’s robust results were driven by double-digit growth across interest and non-interest income sources, helped by strong business momentum, expansion in Net Interest Margin (NIM), and an improved revenue mix, with Non-Funded Income (NFI) contributing 38% to Group revenue, up from 35% in H1 of 2023.

As of June-end 2024, FAB reinforced its position as the largest bank in the UAE with total assets at $320 billion. Loans, advances and Islamic financing grew 6% both y-t-d and y-o-y to $139.67 billion, reflecting healthy demand and market share gains across key segments and geographies.

In the first half of 2024, FAB delivered a return on tangible equity (RoTE) of 17.3%, including 18.1% in Q2 of 2024, demonstrating the Group’s laser focus on shareholder value.

Balance sheet fundamentals remained strong through solid asset quality metrics, with a non-performing loans (NPL) ratio of 3.7%, and a strong liquidity profile displayed in a liquidity coverage ratio of 152%. The Group’s cost-to-income ratio of 24.4% as of June-end 2024 demonstrated superior operating efficiency.

FAB facilitated over $14.16 billion of sustainable and transition financing in Q2 of 2024 and $21.24 billion in the first six months of 2024, taking total projects to date to $56 billion or 41% of FAB’s 2030 pledge of $136 billion, the largest commitment by any MENA company and half of UAE banks’ commitment.

Leading Bank in MENA

FAB’s Group CEO Hana Al Rostamani said that FAB has reaffirmed its position as a leading force in the MENA banking sector, with the Group delivering another strong set of results in the second quarter and first half of 2024.

She said that FAB continued to leverage its international network to capitalise on market opportunities across the globe. The bank was also actively building and expanding business corridors in close alignment with national ambitions, reinforcing our international franchise as a foundation for growth and resilience.

“Our outlook remains anchored in the strong fundamentals of the UAE and Abu Dhabi as a global economic powerhouse and preferred hub for investment, talent, and innovation. We remain on track to meet our 2024 and medium-term guidance, and to deliver sustainable shareholder returns,” she added.

FAB’s Group CFO Lars Kramer said that building on a robust first quarter, we have made progress in the first half of 2024. We continued to achieve high returns at scale while driving diversified growth across our franchise and investing strategically in order to create future efficiencies.

Kramer said that consistent growth in both interest and non-interest income sources reflect our efforts to enhance cross-sell and deepen client relationships, leveraging our differentiated strengths and international footprint.

“With our leading liquidity position and high-quality risk profile, we are upholding very strong fundamentals including a rock-solid capital base, which consolidated further following our Tier 2 bond issuance earlier this month,” Kramer added.

FAB reported strong performance across all business lines in H1’24, led by Investment Banking and Global Markets with significant increases in operating income of 23% y-o-y and 26% y-o-y, respectively.

Consumer Banking operating income advanced 16% y-o-y, reflecting double-digit growth in loans and deposits, new customer acquisitions, enhanced digital service and compelling product offerings.

Private Banking and Corporate & Commercial Banking continued to accelerate client acquisitions and client activity, with the former reporting 25% growth in assets under management. The Group’s international revenue was up 30% yoy, while operating income growth in the UAE also remained strong at +13% y-o-y.