{"id":104514,"date":"2025-06-12T00:00:00","date_gmt":"2025-06-12T00:00:00","guid":{"rendered":"https:\/\/enterpriseam.com\/uae\/uaes-10-largest-banks-see-combined-net-income-rise-8-4-q-o-q-to-aed-22-2-bn-in-1q\/"},"modified":"2025-06-12T00:00:00","modified_gmt":"2025-06-12T00:00:00","slug":"uaes-10-largest-banks-see-combined-net-income-rise-8-4-q-o-q-to-aed-22-2-bn-in-1q","status":"publish","type":"post","link":"https:\/\/enterpriseam.com\/uae\/2025\/06\/12\/uaes-10-largest-banks-see-combined-net-income-rise-8-4-q-o-q-to-aed-22-2-bn-in-1q\/","title":{"rendered":"UAE\u2019s 10 largest banks see combined net income rise 8.4% q-o-q to AED 22.2 bn in 1Q"},"content":{"rendered":"<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"> <strong>The com<\/strong><strong>bined net income of the UAE\u2019s 10 largest listed banks rose 8.4%<\/strong><strong> q-o-q to AE<\/strong><strong>D 22.2 bn in 1Q 2025<\/strong>, despite interest margin losses on the back of rate cuts in the previous quarter, according to management consulting firm Alvarez &amp; Marsal\u2019s <a target=\"_blank\" href=\"https:\/\/ent.news\/2025\/6\/590.pdf\" style=\"\" rel=\"noopener\">UAE Banking Pulse report (pdf)<\/a>. Growth was supported by a 59.3% q-o-q reduction in impairment charges and an 18% quarterly rise in net fee and commission income, the report reads.<\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong style=\"background-color: transparent;\">REMEMBER- <\/strong><span style=\"background-color: transparent;\">The Central Bank of the UAE cut rates by 50 bps last <\/span><a target=\"_blank\" href=\"https:\/\/enterprise.news\/uae\/en\/news\/story\/587da6dc-6c89-4449-87cf-f24013502d3d\/fed-kicks-off-easing-cycle-with-a-bang\" rel=\"noopener\">September<\/a><span style=\"background-color: transparent;\">, and 25 bps in <\/span><a target=\"_blank\" href=\"https:\/\/enterprise.news\/uae\/en\/news\/story\/2c22a2bd-d0a6-4fe1-9209-e5df1448126c\/fed-trims-rate-cuts-by-a-further-25-bps-as-central-bankers-brace-for-an-uncertain-time-for-monetary-policy\" rel=\"noopener\">November<\/a><span style=\"background-color: transparent;\"> and <\/span><a target=\"_blank\" href=\"https:\/\/enterprise.news\/ksa\/en\/news\/story\/f203e9f5-2ccd-41fb-8579-4e4d81199fc9\/%253cmark%253efed%253c%2Fmark%253e-cuts-rates-by-another-25-bps,-signals-slower-easing-cycle-next-year\" rel=\"noopener\">December<\/a><span style=\"background-color: transparent;\"> in line with the US Federal Reserve.<\/span><\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>Net interest margins fell by 15 bps q-o-q to 2.5% <\/strong>despite strong lending activity against the backdrop of rate cuts. Net loans and advances were up 3.6% q-o-q, primarily driven by corporate and wholesale lending, which rose 5.1% on a quarterly basis. <\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>Banks\u2019 deposits outpaced lending<\/strong>, increasing by 5.8% q-o-q, while the loan-to-deposit ratio fell to 74.7%, \u201creflecting improved sector liquidity.\u201d This came in tandem with a 7.8% quarterly decline in operating expenses, which \u201ccontributed meaningfully to profitability.\u201d<\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>Meanwhile, the cost of funds rose by 52 bps to 3.9%, which helped offer \u201csome margin protection.\u201d <\/strong>The cost of risk (CoR) declined by 45 bps q-o-q to 0.3%, while non-performing loan (NPL) ratio also declined to 3.2%, driven by recoveries and a stronger loan book profile.<\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>Profitability metrics were up<\/strong>, with return on equity climbing to 18.6% and return on assets improving to 2.1%. This came despite a 2.1% decline in net interest income (NII) during the quarter.<\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>The banks in question:<\/strong> The UAE\u2019s 10 largest listed banks analyzed in A&amp;M\u2019s UAE Banking Pulse are First Abu Dhabi Bank, Emirates NBD, Abu Dhabi Commercial Bank, Dubai Islamic Bank (DIB), our friends at Mashreq, Abu Dhabi Islamic Bank (ADIB), Commercial Bank of Dubai, National Bank of Fujairah, National Bank of Ras Al Khaimah, and Sharjah Islamic Bank. <\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>Among the major banks,<\/strong> Abu Dhabi Islamic Bank (Adib) and Dubai Islamic Bank (DIB) reported high growth in net L&amp;A by 5.3% and 4.8% q-o-q, respectively, followed by Emirates NBD with 3.8% quarterly growth. <\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>A&amp;M remains optimistic:<\/strong> \u201cDespite flat operating income and the decline in NII due to prior rate cuts, the sector remained relatively resilient, supported by efficiency gains and healthy balance sheet growth. Overall, the Q1\u201925 pulse reflects a positive trajectory for Middle East banks, marked by solid profitability, expanding loan books, and improving return ratios, setting a strong tone for the year ahead,\u201d A&amp;M Managing Director, Financial Services Asad Ahmed said.<\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>REMEMBER-<\/strong> The combined net income of the UAE\u2019s 10 largest listed banks rose 8% y-o-y to AED 82.9 bn in 2024, according to Alvarez &amp; Marsal\u2019s <a target=\"_blank\" href=\"https:\/\/enterprise.news\/uae\/en\/news\/edition\/am\/ecb15e6d-c555-4eba-b544-e1bb3c762a15\" style=\"\" rel=\"noopener\">report<\/a> for FY 2024. Growth was supported by a 6.7% increase in net interest income to AED 97.6 bn \u2014 its slowest pace in three years \u2014 alongside a 22% rise in net fees and commission income and lower impairment charges.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Growth was supported by a 59.3% q-o-q reduction in impairment charges and an 18% quarterly rise in net fee and commission income<\/p>\n","protected":false},"author":1,"featured_media":104515,"comment_status":"","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"newspack_ads_suppress_ads":false,"newspack_popups_has_disabled_popups":false,"newspack_sponsor_sponsorship_scope":"","newspack_sponsor_native_byline_display":"inherit","newspack_sponsor_native_category_display":"inherit","newspack_sponsor_underwriter_style":"inherit","newspack_sponsor_underwriter_placement":"inherit","ep_exclude_from_search":false,"_primary_brand":0,"newspack_featured_image_position":"","newspack_post_subtitle":"","newspack_article_summary_title":"Overview:","newspack_article_summary":"","newspack_hide_updated_date":false,"newspack_show_updated_date":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[1618],"tags":[215,407,159,1011,188,260,7,65,288,730,1774,674],"brand":[],"newspack_spnsrs_tax":[],"class_list":["post-104514","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-banking","tag-abu-dhabi-commercial-bank","tag-abu-dhabi-islamic-bank","tag-banking","tag-commercial-bank-of-dubai","tag-dubai-islamic-bank","tag-emirates-nbd","tag-enterpriseam-uae","tag-first-abu-dhabi-bank","tag-mashreq","tag-national-bank-of-fujairah","tag-national-bank-of-ras-al-khaimah","tag-sharjah-islamic-bank","wpautop","entry"],"acf":{"mongo_id":"523cbc72-2cb5-4ed4-a4ab-739022c2e23c","order":"6","is_powered_by":false,"story_type":"1","photo_url":"https:\/\/ent.news\/2024\/10\/2667.jpg","photo_position":"above","homepage_title":"","full_issue_title":"UAE\u2019s 10 largest banks see combined net income rise 8.4% q-o-q to AED 22.2 bn in 1Q","related_issue":[104504],"teaser":"Growth was supported by a 59.3% q-o-q reduction in impairment charges and an 18% quarterly rise in net fee and commission income","voice_url":"https:\/\/s3.us-east-1.amazonaws.com\/ent.news\/audio\/2025\/6\/.1c2c01c2-38f8-4fb0-abd0-f5d0a65bc1ba.mp3"},"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v27.1 (Yoast SEO v27.1.1) - 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