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Emirates NBD announces H1 2020 results, reporting AED 4.1 billion in net profit

Emirates NBD. one of the major banks in the GCC region, has revealed strong results from the H1 2020 fiscal period.

Total income of AED 12.6 billion improved 33% y-o-y on loan growth and higher fee income from the inclusion of DenizBank Net Profit of AED 4.1 billion, 45% lower y-o-y on higher provisions and non-repeated gain on disposal of Network International stake Common equity tier 1 ratio strengthens to 15.3%

Emirates NBD, a major bank in the GCC region, delivered a net profit of AED 4.1 billion for the first half of 2020. Net interest income increased 36% y-o-y and non-funded income grew 24% y-o-y with the acquisition of DenizBank in 2019. Net profit declined 45% y-o-y due to higher impairment charges and the gain on disposal of a stake in Network International not repeated in 2020. Excluding the gain from Network International net profit was down 24%. The Group’s balance sheet remains strong with healthy liquidity, credit quality and capital ratios. The Group increased impairment allowances for Stage 1 and 2 coverage in anticipation of a potential deterioration in credit quality in subsequent quarters related to the coronavirus (Covid-19) pandemic. 

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Financial Highlights – H1 2020 

  • Total income of AED 12.6 billion improved 33% y-o-y on loan growth and higher fee income from the inclusion of DenizBank

  • Net profit of AED 4.1 billion declined 45% y-o-y on higher provisions and gain from sale of Network International shares not repeated in 2020. Excluding the Network International gain in Q2-19, net profit was down 24%

  • Impairment allowances increased to AED 4.2 billion with annualised net cost of risk increasing to 172 bps as the Group increased Stage 1 and 2 expected credit loss (ECL) allowances 

  • Net interest margin improved 7 bps y-o-y to 2.84% helped by the positive impact of DenizBank

  • Total assets at AED 694 billion, up 2% from end 2019

  • Customer loans at AED 443 billion, up 1% from end 2019

  • Customer deposits at AED 461 billion, down 2% from end 2019

  • Non-performing loan ratio increased to 5.8% and coverage ratio remained strong at 116.9% 

  • Liquidity coverage ratio of 152.5% and advances to deposit ratio of 96.1% demonstrate a healthy liquidity position 

  • Common equity tier 1 ratio strengthened to 15.3%, over 7% above minimum requirements  

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