Emirates NBD Q3 net profit jumps 37% on lower impairments

Emirates NBD, Dubai's biggest bank by assets, posted a 37 per cent jump in third-quarter net profit, beating analysts' forecasts, as margins and operating income rose and the amount set aside to cover bad debts shrank.

Net profit attributable to equity owners in the three months ending September 30 reached Dh2.27 billion compared with Dh1.66bn a year earlier, the company said in a statement to the Dubai bourse, where its shares are traded.

Three analysts polled by Bloomberg had forecast an average net profit of Dh1.94bn.

Operating income for the period rose 9.7 per cent to Dh3.96bn from Dh3.61bn, while net impairment loss on financial assets shrank by 40.8 per cent to Dh431.3 million from Dh728.6m, reported for the third quarter of 2016.

“Margins have continued to improve throughout 2017, helped by rate rises and an improvement in funding costs,” Emirates NBD’s group chief executive Shayne Nelson said. “We continue to extend our international branch network and, following the opening of the branch in India, work continues on opening three more branches in Saudi Arabia.”

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Customer loans stood at Dh304.1bn at the close of the third quarter, a 5 per cent rise from the end of 2016 level, while customer deposits climbed 4 per cent to Dh322bn from the end of last year.

Total assets reached Dh461.1bn at the end of the third quarter, up 3 per cent from the end of 2016 level.

“We achieved a record performance for the first nine months of 2017 as we delivered positive jaws with higher income and lower expenses,” said group chief financial officer Surya Subramanian. “The bank is well placed to meet various accounting and regulatory changes that take effect in 2018 and we do not expect any material impact as a result.”

The bank's net interest margins also improved to 2.56 per cent in the third quarter, compared with 2.44 per cent a year earlier, thanks to higher interest rates and lower funding costs as the liquidity crunch eased.

“Net interest margin continues to widen and the pace of improvement was better than expected,” said Shabbir Malik, an analyst at Egyptian investment bank EFG-Hermes based in Dubai. He added that lower provisioning was behind the results beating their forecast for third-quarter net profit.

Emirates NBD said it expects net interest margins this year to range between 2.45 and 2.5 per cent and improve in the next quarter because of recent interest rate hikes and cheaper funding.

Net interest income climbed 10 per cent to Dh2.80bn, while non-interest income rose 9 per cent to Dh1.16bn.

“Increasing customer-based fee income from treasury sales, trade finance and cash management remains a strategic priority for wholesale banking,” Emirates NBD said.

The specs: 2018 Jaguar F-Type Convertible

Price, base / as tested: Dh283,080 / Dh318,465

Engine: 2.0-litre inline four-cylinder

Transmission: Eight-speed automatic

Power: 295hp @ 5,500rpm

Torque: 400Nm @ 1,500rpm

Fuel economy, combined: 7.2L / 100km

Tuesday's fixtures

Group A

Kyrgyzstan v Qatar, 5.45pm

Iran v Uzbekistan, 8pm

N Korea v UAE, 10.15pm

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Need to know

When: October 17 until November 10

Cost: Entry is free but some events require prior registration

Where: Various locations including National Theatre (Abu Dhabi), Abu Dhabi Cultural Center, Zayed University Promenade, Beach Rotana (Abu Dhabi), Vox Cinemas at Yas Mall, Sharjah Youth Center

What: The Korea Festival will feature art exhibitions, a B-boy dance show, a mini K-pop concert, traditional dance and music performances, food tastings, a beauty seminar, and more.

For more information: www.koreafestivaluae.com

The specs

The specs: 2019 Audi Q8
Price, base: Dh315,000
Engine: 3.0-litre turbocharged V6
Gearbox: Eight-speed automatic
Power: 340hp @ 3,500rpm
Torque: 500Nm @ 2,250rpm
Fuel economy, combined: 6.7L / 100km

RESULTS

5pm: Handicap (TB) Dh100,000, 2,400m
Winner: Recordman, Richard Mullen (jockey), Satish Seemar (trainer)

5.30pm: Wathba Stallions Cup Handicap (PA) Dh 70,000, 2,200m
Winner: AF Taraha, Tadhg O’Shea, Ernst Oertel

6pm: Abu Dhabi Fillies Classic Prestige (PA) Dh110,000, 1,400m
Winner: Dhafra, Fabrice Veron, Eric Lemartinel

6.30pm: Abu Dhabi Colts Classic Prestige (PA) Dh110,000, 1,400m
Winner: Maqam, Fabrice Veron, Eric Lemartinel

7pm: Handicap (PA) Dh85,000, 1,600m
Winner: AF Momtaz, Fernando Jara, Musabah Al Muhairi

7.30pm: Maiden (PA) Dh80,000, 1,600m
Winner: Optimizm, Patrick Cosgrave, Abdallah Al Hammadi

The specs

Engine: 3.0-litre six-cylinder turbo

Power: 398hp from 5,250rpm

Torque: 580Nm at 1,900-4,800rpm

Transmission: Eight-speed auto

Fuel economy, combined: 6.5L/100km

On sale: December

Price: From Dh330,000 (estimate)

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Essentials

The flights

Etihad (etihad.ae) and flydubai (flydubai.com) fly direct to Baku three times a week from Dh1,250 return, including taxes.

The stay

A seven-night “Fundamental Detox” programme at the Chenot Palace (chenotpalace.com/en) costs from €3,000 (Dh13,197) per person, including taxes, accommodation, 3 medical consultations, 2 nutritional consultations, a detox diet, a body composition analysis, a bio-energetic check-up, four Chenot bio-energetic treatments, six Chenot energetic massages, six hydro-aromatherapy treatments, six phyto-mud treatments, six hydro-jet treatments and access to the gym, indoor pool, sauna and steam room. Additional tests and treatments cost extra.

if you go

The flights
Emirates flies to Delhi with fares starting from around Dh760 return, while Etihad fares cost about Dh783 return. From Delhi, there are connecting flights to Lucknow.
Where to stay
It is advisable to stay in Lucknow and make a day trip to Kannauj. A stay at the Lebua Lucknow hotel, a traditional Lucknowi mansion, is recommended. Prices start from Dh300 per night (excluding taxes).