Emirates NBD, the biggest lender by assets in Dubai, reported a 24 per cent year-on-year decline in its first quarter net income as it increased provisions for potential bad loans amid the coronavirus pandemic.
Net profit for three months to the end of March declined to Dh2.1 billion, the lender said in a statement to the Dubai Financial Market, where its shares trade.
While credit quality was stable in the first quarter of the year, Emirates NBD increased impairment allowances in recognition of a “potential deterioration” in credit quality in subsequent quarters related to the coronavirus pandemic, it said.
Total impairment charges for the reporting period increased more than three-fold to Dh2.56bn at the end of March 2019. Operating profit before impairments came in 46 per cent higher at Dh4.84bn, but fell 17 per cent year-on-year to Dh2.28bn after the charge for potential bad loans.
“The operating performance for the first quarter of 2020 was good, prior to the emergence of the economic impact of Covid-19 in March 2020,” Patrick Sullivan, group chief financial officer, said.
Regional banks are “facing multiple challenges” from low interest rates, low oil prices and lower economic growth due to disruption from the pandemic, he said.
“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.”
Lenders worldwide are facing a decline in profitability as loan growth slows and interest rates plunge due to the pandemic's disruption of the global economy. Last week, JPMorgan Chase, America's largest bank, reported a 69 per cent drop in first quarter profit, as it set aside $8.3bn for loan-loss provisions.
The global economy has slumped into the worst recession since the Great Depression of the 1930s. The International Monetary Fund last week projected a 3 per cent contraction in global output for 2020 and said the outlook for the world economy is worse than the 2008 global economic crisis.
The UAE, the second-biggest Arab economy, was the first in the Middle East and North Africa to roll out Dh282bn in fiscal and monetary support, providing zero interest funding to banks to boost lending growth in the country. In addition, the government implemented a variety of other initiatives that range from discounted utility bills to waivers of fees to buttress the economy.
Emirates NBD on Monday said its total income climbed 46 per cent to Dh6.88bn due to loan growth and higher fee income including its Turkish unit DenizBank. Net interest margin improved 19 basis points to 3.02 per cent, helped by the positive impact of DenizBank.
DenizBank, which is the fifth-largest private bank in Turkey, contributed total income of Dh2.25bn and net profit of Dh504m to the Group for the first three months of 2020.
Emirates NBD’s total assets at the end of the first quarter climbed to Dh691.7bn, up 1 per cent from the end of 2019, while loans also climbed by 1 per cent to Dh443bn for the period. Customer deposits remained steady at Dh467bn.
The bank’s non-performing loans ratio was stable at 5.5 per cent and its coverage ratio improved by 8.2 per cent to 120.5 per cent, the bank said. Common equity tier 1 ratio at 14.8 per cent was well above minimum regulatory requirements, it added.
Emirates NBD is among UAE banks that have rolled out support measures to help reduce financial stress for their clients.
Banks have extended relief to businesses and individuals, particularly in stressed sectors, through reduced costs and fees, loan deferrals, reduced interest rates and lower processing fees.
Earlier this week, the UAE Central Bank urged lenders to help individual borrowers as well as small and medium-sized enterprises to blunt the impact of the pandemic on the country’s economy. UAE lenders have so far tapped 30 per cent of a Dh50bn Targeted Economic Support Scheme facility and "are passing on these funds to their customers affected by the Covid-19 pandemic", governor Abdulhamid Saeed said on Sunday.
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
The specs
Engine: Dual 180kW and 300kW front and rear motors
Power: 480kW
Torque: 850Nm
Transmission: Single-speed automatic
Price: From Dh359,900 ($98,000)
On sale: Now
What is blockchain?
Blockchain is a form of distributed ledger technology, a digital system in which data is recorded across multiple places at the same time. Unlike traditional databases, DLTs have no central administrator or centralised data storage. They are transparent because the data is visible and, because they are automatically replicated and impossible to be tampered with, they are secure.
The main difference between blockchain and other forms of DLT is the way data is stored as ‘blocks’ – new transactions are added to the existing ‘chain’ of past transactions, hence the name ‘blockchain’. It is impossible to delete or modify information on the chain due to the replication of blocks across various locations.
Blockchain is mostly associated with cryptocurrency Bitcoin. Due to the inability to tamper with transactions, advocates say this makes the currency more secure and safer than traditional systems. It is maintained by a network of people referred to as ‘miners’, who receive rewards for solving complex mathematical equations that enable transactions to go through.
However, one of the major problems that has come to light has been the presence of illicit material buried in the Bitcoin blockchain, linking it to the dark web.
Other blockchain platforms can offer things like smart contracts, which are automatically implemented when specific conditions from all interested parties are reached, cutting the time involved and the risk of mistakes. Another use could be storing medical records, as patients can be confident their information cannot be changed. The technology can also be used in supply chains, voting and has the potential to used for storing property records.
Mubadala World Tennis Championship 2018 schedule
Thursday December 27
Men's quarter-finals
Kevin Anderson v Hyeon Chung 4pm
Dominic Thiem v Karen Khachanov 6pm
Women's exhibition
Serena Williams v Venus Williams 8pm
Friday December 28
5th place play-off 3pm
Men's semi-finals
Rafael Nadal v Anderson/Chung 5pm
Novak Djokovic v Thiem/Khachanov 7pm
Saturday December 29
3rd place play-off 5pm
Men's final 7pm
RESULTS
Cagliari 5-2 Fiorentina
Udinese 0-0 SPAL
Sampdoria 0-0 Atalanta
Lazio 4-2 Lecce
Parma 2-0 Roma
Juventus 1-0 AC Milan
Key findings of Jenkins report
- Founder of the Muslim Brotherhood, Hassan al Banna, "accepted the political utility of violence"
- Views of key Muslim Brotherhood ideologue, Sayyid Qutb, have “consistently been understood” as permitting “the use of extreme violence in the pursuit of the perfect Islamic society” and “never been institutionally disowned” by the movement.
- Muslim Brotherhood at all levels has repeatedly defended Hamas attacks against Israel, including the use of suicide bombers and the killing of civilians.
- Laying out the report in the House of Commons, David Cameron told MPs: "The main findings of the review support the conclusion that membership of, association with, or influence by the Muslim Brotherhood should be considered as a possible indicator of extremism."
Dubai World Cup nominations
UAE: Thunder Snow/Saeed bin Suroor (trainer), North America/Satish Seemar, Drafted/Doug Watson, New Trails/Ahmad bin Harmash, Capezzano, Gronkowski, Axelrod, all trained by Salem bin Ghadayer
USA: Seeking The Soul/Dallas Stewart, Imperial Hunt/Luis Carvajal Jr, Audible/Todd Pletcher, Roy H/Peter Miller, Yoshida/William Mott, Promises Fulfilled/Dale Romans, Gunnevera/Antonio Sano, XY Jet/Jorge Navarro, Pavel/Doug O’Neill, Switzerland/Steve Asmussen.
Japan: Matera Sky/Hideyuki Mori, KT Brace/Haruki Sugiyama. Bahrain: Nine Below Zero/Fawzi Nass. Ireland: Tato Key/David Marnane. Hong Kong: Fight Hero/Me Tsui. South Korea: Dolkong/Simon Foster.
Museum of the Future in numbers
- 78 metres is the height of the museum
- 30,000 square metres is its total area
- 17,000 square metres is the length of the stainless steel facade
- 14 kilometres is the length of LED lights used on the facade
- 1,024 individual pieces make up the exterior
- 7 floors in all, with one for administrative offices
- 2,400 diagonally intersecting steel members frame the torus shape
- 100 species of trees and plants dot the gardens
- Dh145 is the price of a ticket
Info
What: 11th edition of the Mubadala World Tennis Championship
When: December 27-29, 2018
Confirmed: men: Novak Djokovic, Rafael Nadal, Kevin Anderson, Dominic Thiem, Hyeon Chung, Karen Khachanov; women: Venus Williams
Tickets: www.ticketmaster.ae, Virgin megastores or call 800 86 823
Libya's Gold
UN Panel of Experts found regime secretly sold a fifth of the country's gold reserves.
The panel’s 2017 report followed a trail to West Africa where large sums of cash and gold were hidden by Abdullah Al Senussi, Qaddafi’s former intelligence chief, in 2011.
Cases filled with cash that was said to amount to $560m in 100 dollar notes, that was kept by a group of Libyans in Ouagadougou, Burkina Faso.
A second stash was said to have been held in Accra, Ghana, inside boxes at the local offices of an international human rights organisation based in France.
COMPANY%20PROFILE
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Kamindu Mendis bio
Full name: Pasqual Handi Kamindu Dilanka Mendis
Born: September 30, 1998
Age: 20 years and 26 days
Nationality: Sri Lankan
Major teams Sri Lanka's Under 19 team
Batting style: Left-hander
Bowling style: Right-arm off-spin and slow left-arm orthodox (that's right!)
UAE currency: the story behind the money in your pockets
UAE currency: the story behind the money in your pockets
Timeline
1947
Ferrari’s road-car company is formed and its first badged car, the 125 S, rolls off the assembly line
1962
250 GTO is unveiled
1969
Fiat becomes a Ferrari shareholder, acquiring 50 per cent of the company
1972
The Fiorano circuit, Ferrari’s racetrack for development and testing, opens
1976
First automatic Ferrari, the 400 Automatic, is made
1987
F40 launched
1988
Enzo Ferrari dies; Fiat expands its stake in the company to 90 per cent
2002
The Enzo model is announced
2010
Ferrari World opens in Abu Dhabi
2011
First four-wheel drive Ferrari, the FF, is unveiled
2013
LaFerrari, the first Ferrari hybrid, arrives
2014
Fiat Chrysler announces the split of Ferrari from the parent company
2015
Ferrari launches on Wall Street
2017
812 Superfast unveiled; Ferrari celebrates its 70th anniversary
