Big UAE banks keep growing even as impairments make noise

The UAE’s three largest banks — Emirates NBD, First Abu Dhabi Bank, and Abu Dhabi Commercial Bank — reported additional impairment charges as they began to navigate an environment of elevated tensions and market volatility near the end of 1Q 2026. Still, both banks struck positive tones for the year ahead, citing both their solid liquidity positions and the Central Bank of the UAE’s relief measures for the sector.

Emirates NBD had a solid 1Q

Emirates NBD, the UAE’s largest lender, saw its net income rise 3% y-o-y to AED 6.4 bn in 1Q 2026, according to its financials (pdf) and earnings release (pdf). Total operating income came in at a record AED 14.4 bn, up 21% y-o-y, powered by 7% loan growth and a 42% jump in non-funded income, helping offset lower interest rates.

The balance sheet kept doing the heavy lifting: Total assets surpassed AED 1.2 tn, up 18% y-o-y, while gross loans jumped 28% to AED 703 bn and deposits rose 19% to AED 830 bn. Asset quality improved too, with the NPL ratio falling to 2.3% from 3.1% a year earlier.

A more cautious note beneath the headline numbers: Impairment allowances totaled AED 0.8 bn, as management took what it called a prudent provisioning approach across DenizBank and Emirates NBD, including an additional precautionary charge for the UAE during the quarter.

The bank has also been implementing its own relief measures for its customers, including fee waivers and deferrals, which it extended for another month this week. The measures are aimed at “helping businesses navigate through the current environment,” the lender’s vice chairman and managing director Hesham Abdulla Al Qassim said.

REMEMBER- The lender is still very much in expansion mode: Emirates NBD is pushing ahead with its planned majority acquisition of India’s RBL Bank while also recently securing a USD 2.25 bn syndicated loan at record-tight spreads. It was also among Gulf lenders tapping USD private markets during the conflict period, raising some USD 325 mn.

FAB beat analyst expectations but reported a dip in net income

Meanwhile, First Abu Dhabi Bank (FAB) saw net income slip 2% y-o-y to AED 5.0 bn in 1Q 2026, even as operating income rose 6% to AED 9.3 bn, according to its management discussion and analysis report (pdf). The drag came from higher provisioning rather than weaker core activity, with net interest income climbing 12% to AED 5.61 bn. Still, its net income beat analysts’ expectations of AED 4.38 bn, according to LSEG data picked up by Reuters.

Credit costs were at fault: Net impairment charges jumped 52% y-o-y to AED 1.1 bn and included AED 300 mn of management overlays tied to what FAB described as an “evolving external environment” after a more volatile end to the quarter. Excluding those overlays, the bank said net income would have risen 3%.

Total assets rose 14% y-o-y to AED 1.5 tn, exceeding USD 400 bn for the first time, while net loans and advances climbed 22% to AED 668 bn and customer deposits increased 4% to AED 871 bn. The lender also stayed active in debt markets, raising GBP 450 mn in March after two USD 750 mn issuances earlier in the quarter, followed by a further USD 100 mn private placement after the conflict began.

Looking ahead, the bank said its liquidity buffers stood “well above” regulatory requirements as of the end of March, keeping it in a strong position to “deliver sustainable returns at scale.”

ADCB kept the lenders’ streak alive

Abu Dhabi Commercial Bank (ADCB) reported net income of AED 3.4 bn in 1Q 2026, up 37% y-o-y, according to its earnings presentation (pdf) and management discussion and analysis report (pdf). Operating income climbed 18% to AED 5.9 bn, supported by stronger fee and trading income.

Diverse revenue streams brought home results: Net interest income rose 10% y-o-y to AED 3.7 bn, while non-interest income jumped 36% to AED 2.2 bn, accounting for 37% of operating income versus 32% a year earlier. The bank also posted a record-low cost-to-income ratio of 25.6%, as revenue growth outpaced costs.

The balance sheet stayed solid: Total assets rose 19% y-o-y to AED 808.9 bn, while net loans climbed 18% to AED 425.7 bn and customer deposits increased 18% to AED 523.1 bn.

Like Emirates NBD, the lender is also staying in expansion mode: ADCB recently helped finance the USD 500 mn Jubail industrial wastewater project in Saudi Arabia and secured a permit to launch a subsidiary bank in Kazakhstan, extending its regional footprint. That follows last year’s AED 6.1 bn rights issue — the largest-ever transaction by an ADX-listed company — which further strengthened its capital base.

But ADCB wasn’t immune to the provisioning trend: Impairment charges totaled AED 638 mn, with management citing provision overlays to address “heightened geopolitical risks.” Even so, the bank reiterated its 2026 guidance, citing continued momentum, disciplined execution, and confidence in the UAE’s underlying economic fundamentals.

ICYMI- Impairment charges also weighed on United Arab Bank and Commercial Bank of Dubai in 1Q, though both still reported higher operating income and balance sheet expansion. Catch up here.