The aggregate net income of the 10 largest lenders in the UAE grew more than 24 per cent in the first quarter of 2022, compared with the previous three months, according to professional services company Alvarez & Marsal.
The cumulative net income includes the Dh2.8 billion ($769.4 million) gain recorded by First Abu Dhabi Bank on the sale of its stake in Magnati. Excluding that one-off boost, aggregate net profit declined 2.6 per cent quarter-on-quarter, the consultancy said in its 2022 first-quarter UAE Banking Pulse report.
Most top-10 banks in the UAE reported a rise in profitability in the first quarter, despite lower interest income, as the Arab world’s second-largest economy continued to recover from the coronavirus-pandemic-driven slowdown.
Banks are set for a further boost in profitability in the coming quarters, said the company best known for its restructuring work.
“Rising oil prices, supportive government policies, revival signs in the real estate sector and normalising non-oil activity are expected to accelerate the UAE’s economy in the next quarter,” Asad Ahmed, managing director and head of Middle East financial services at A&M, said.
The UAE economy posted strong growth last year and has carried the growth momentum into 2022. The Emirates' non-oil economy expanded an annual 7.8 per cent in the fourth quarter of 2021, the Central Bank of the UAE said in its Quarterly Economic Review.
In March, Sheikh Mohammed bin Rashid, Vice President and Ruler of Dubai, on Twitter said the country's economy grew 3.8 per cent in 2021, above the World Bank's 2.1 per cent estimate. The International Monetary Fund expects the UAE's economy to expand 4.2 per cent in 2022.
Banks in the Emirates are also expected to benefit from rising interest rates. The US Federal Reserve earlier this month raised interest rates by 50 basis points, a move mimicked by the CBUAE.
UAE lenders' net income is estimated to increase 15 per cent and return on assets to grow 1.4 per cent, for every 100 bps increase in interest rates, according to S&P Global Ratings.
“We anticipate domestic lending to grow on the back of revived economic activities, and NIM [net interest margin] to improve as benchmark interest rates have increased by 50 basis points,” Mr Ahmed said.
“Deposits are also expected to grow, underpinned by the projected interest rate increase.”
Rising oil prices, supportive government policies, revival signs in the real estate sector and normalising non-oil activity are expected to accelerate the UAE’s economy in the next quarter
Asad Ahmed,
managing director and head of Middle East financial services, A&M
The survey covered the UAE’s top 10 banks by assets – First Abu Dhabi Bank, Emirates NBD, Abu Dhabi Commercial Bank, Dubai Islamic Bank, Mashreq Bank, Abu Dhabi Islamic Bank, Commercial Bank of Dubai, National Bank of Fujairah, National Bank of Ras Al Khaimah and Sharjah Islamic Bank.
The aggregate loans and advances of these lenders increased 2.8 per cent quarter on quarter. Loans-to-deposit ratio increased to 84.5 per cent from 82.1 per cent in the last quarter of 2021.
The cumulative non-interest income increased 0.6 per cent on a quarterly basis as the overall net interest margin remained flat at 2.1 per cent.
Asset quality of banks also improved as non-performing loans fell by 0.1 percentage points to 6.1 per cent during the quarter. However, there are potential asset quality risks in the second half of the year, when the CBUAE ends its targeted economic support scheme, the report said.
The specs
- Engine: 3.9-litre twin-turbo V8
- Power: 640hp
- Torque: 760nm
- On sale: 2026
- Price: Not announced yet
MATCH INFO
Uefa Champions League quarter-final second leg:
Juventus 1 Ajax 2
Ajax advance 3-2 on aggregate
Jiu-jitsu calendar of events for 2017-2018:
August 5:
Round-1 of the President’s Cup in Al Ain.
August 11-13:
Asian Championship in Vietnam.
September 8-9:
Ajman International.
September 16-17
Asian Indoor and Martial Arts Games, Ashgabat.
September 22-24:
IJJF Balkan Junior Open, Montenegro.
September 23-24:
Grand Slam Los Angeles.
September 29:
Round-1 Mother of The Nation Cup.
October 13-14:
Al Ain U18 International.
September 20-21:
Al Ain International.
November 3:
Round-2 Mother of The National Cup.
November 4:
Round-2 President’s Cup.
November 10-12:
Grand Slam Rio de Janeiro.
November 24-26:
World Championship, Columbia.
November 30:
World Beach Championship, Columbia.
December 8-9:
Dubai International.
December 23:
Round-3 President’s Cup, Sharjah.
January 12-13:
Grand Slam Abu Dhabi.
January 26-27:
Fujairah International.
February 3:
Round-4 President’s Cup, Al Dhafra.
February 16-17:
Ras Al Khaimah International.
February 23-24:
The Challenge Championship.
March 10-11:
Grand Slam London.
March 16:
Final Round – Mother of The Nation.
March 17:
Final Round – President’s Cup.
Lexus LX700h specs
Engine: 3.4-litre twin-turbo V6 plus supplementary electric motor
Power: 464hp at 5,200rpm
Torque: 790Nm from 2,000-3,600rpm
Transmission: 10-speed auto
Fuel consumption: 11.7L/100km
On sale: Now
Price: From Dh590,000
Killing of Qassem Suleimani
The%20specs
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GAC GS8 Specs
Engine: 2.0-litre 4cyl turbo
Power: 248hp at 5,200rpm
Torque: 400Nm at 1,750-4,000rpm
Transmission: 8-speed auto
Fuel consumption: 9.1L/100km
On sale: Now
Price: From Dh149,900
Gothia Cup 2025
4,872 matches
1,942 teams
116 pitches
76 nations
26 UAE teams
15 Lebanese teams
2 Kuwaiti teams
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Position: legal consultant with Al Rowaad Advocates and Legal Consultants.
UAE currency: the story behind the money in your pockets
The specs
Engine: Four electric motors, one at each wheel
Power: 579hp
Torque: 859Nm
Transmission: Single-speed automatic
Price: From Dh825,900
On sale: Now
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UAE currency: the story behind the money in your pockets
FINAL RESULT
Sharjah Wanderers 20 Dubai Tigers 25 (After extra-time)
Wanderers
Tries: Gormley, Penalty
cons: Flaherty
Pens: Flaherty 2
Tigers
Tries: O’Donnell, Gibbons, Kelly
Cons: Caldwell 2
Pens: Caldwell, Cross
THE SPECS
Engine: 3.5-litre V6
Transmission: six-speed manual
Power: 325bhp
Torque: 370Nm
Speed: 0-100km/h 3.9 seconds
Price: Dh230,000
On sale: now
Tips on buying property during a pandemic
Islay Robinson, group chief executive of mortgage broker Enness Global, offers his advice on buying property in today's market.
While many have been quick to call a market collapse, this simply isn’t what we’re seeing on the ground. Many pockets of the global property market, including London and the UAE, continue to be compelling locations to invest in real estate.
While an air of uncertainty remains, the outlook is far better than anyone could have predicted. However, it is still important to consider the wider threat posed by Covid-19 when buying bricks and mortar.
Anything with outside space, gardens and private entrances is a must and these property features will see your investment keep its value should the pandemic drag on. In contrast, flats and particularly high-rise developments are falling in popularity and investors should avoid them at all costs.
Attractive investment property can be hard to find amid strong demand and heightened buyer activity. When you do find one, be prepared to move hard and fast to secure it. If you have your finances in order, this shouldn’t be an issue.
Lenders continue to lend and rates remain at an all-time low, so utilise this. There is no point in tying up cash when you can keep this liquidity to maximise other opportunities.
Keep your head and, as always when investing, take the long-term view. External factors such as coronavirus or Brexit will present challenges in the short-term, but the long-term outlook remains strong.
Finally, keep an eye on your currency. Whenever currency fluctuations favour foreign buyers, you can bet that demand will increase, as they act to secure what is essentially a discounted property.
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(Warp)
Benefits of first-time home buyers' scheme
- Priority access to new homes from participating developers
- Discounts on sales price of off-plan units
- Flexible payment plans from developers
- Mortgages with better interest rates, faster approval times and reduced fees
- DLD registration fee can be paid through banks or credit cards at zero interest rates
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Company name: baraka
Started: July 2020
Founders: Feras Jalbout and Kunal Taneja
Based: Dubai and Bahrain
Sector: FinTech
Initial investment: $150,000
Current staff: 12
Stage: Pre-seed capital raising of $1 million
Investors: Class 5 Global, FJ Labs, IMO Ventures, The Community Fund, VentureSouq, Fox Ventures, Dr Abdulla Elyas (private investment)
UPI facts
More than 2.2 million Indian tourists arrived in UAE in 2023
More than 3.5 million Indians reside in UAE
Indian tourists can make purchases in UAE using rupee accounts in India through QR-code-based UPI real-time payment systems
Indian residents in UAE can use their non-resident NRO and NRE accounts held in Indian banks linked to a UAE mobile number for UPI transactions
COMPANY PROFILE
Founders: Alhaan Ahmed, Alyina Ahmed and Maximo Tettamanzi
Total funding: Self funded
