First Abu Dhabi Banks Reports Growth in Net Profit and Revenue in Q1-2024

Underlining its bank’s consistent growth trajectory, First Abu Dhabi Bank (FAB), one of the largest bank in the Middle East, on Wednesday reported a strong net profit of $1.14 billion and revenue of $2.18 billion for the first quarter of this year.

The bank’s stellar performance is evidenced by revenue that grew 18% year-on-year (y-o-y), propelled by core operational growth, balance sheet expansion, higher Net Interest Margin (NIM), and robust non-funded income (NFI).

The double-digit growth largely offset the impact of the recently implemented UAE corporate tax. The contribution of non-interest income to Group revenue grew to 39% and net profit increased 6% y-o-y.

FAB solidified its position as the largest bank in the UAE as of March-end 2024, with total assets at $336 billion, loans at $138.31 billion and deposits at $218.63 billion, all historical highs, the company said in a disclosure with Abu Dhabi Securities Exchange (ADX) this morning.

The bank’s Return on Tangible Equity (RoTE) of 17.4% is also well on track with 2024 and medium-term guidance of over 16%, underlining the bank’s focus on delivering sustained shareholder value. FAB continues to maintain strong liquidity and robust operational efficiencies, highlighted in its 24% cost to income ratio.

Double-Digit Growth

FAB Group CEO Hana Al Rostamani said that the bank continued to deliver robust performance, reflected in double-digit growth in revenue year-on-year, supported by strong business momentum. This further strengthens our fundamentals, including our total asset base crossing the $330 billion threshold.

“In 2024, we continue to demonstrate the same strengths that led to our exceptional performance in 2023, with growth in profits and revenues, backed by operational efficiencies and financial resilience. Our performance is anchored in the strength of the UAE economy, and increasingly backed by the dynamism of our international operations,” she said.

“We keep our customers and clients at the centre of everything we do, integrating cutting-edge technology and innovation, diversification, and financial sustainability, as we respond to the rapidly evolving needs of regional and international markets,” Hana added.

FAB Group’s Chief Financial Officer Lars Kramer said that the growth in non-funded income, in particular, was pleasing as they continued to leverage FAB’s region-leading capabilities, diversified business model and sophisticated Global Markets platform to further deepen client relationships. Kramer said that the strong revenue growth also enabled us to largely offset the impact of the UAE corporate tax and to maintain robust provision coverage levels, particularly in the context of a global environment marked by continued uncertainties.

“The first quarter’s performance was achieved while maintaining a strong balance sheet, rock-solid capital base, leading liquidity position, and high-quality risk profile. We also continued to make excellent progress against our sustainability agenda with the issuance of the first ever social bonds from the UAE. We remain committed to delivering above 16% RoTE over the medium term, as evidenced by our Q1 outcome of 17.4%,” Kramer explained.