By: Mahmoud Gamal

Dubai – Mubasher: Four banks listed on the Dubai Financial Market (DFM) have disclosed their financial results for the full-year 2018. Combined, the banks’ results have exceeded expectations with their board recommending generous dividend distributions that support these banks’ strength despite ongoing market challenges.

Statistics compiled by Mubasher showed that the four banks registered a combined net profit of AED 13.2 billion ($3.59 billion) in 2018, a rise of 17.5% from AED 11.23 billion ($3.08 billion) in 2017.

Emirates NBD topped its peers, so far, with AED 10.04 billion in net profits, up 20% year-on-year from AED 8.345 billion in on 2017. The higher income came on the back of a 13% rise in total operating income to AED 17.4 billion.

Following the profit increase, analysts expect Emirates NBD’s shareholders to consider a 40% cash dividend, amounting to 40 fils per share, for 2018, and totalling AED 2.223 billion. The bank’s general meeting will convene on 20 February to discuss the dividend distribution.

Mashreq Bank came in second with AED 2.1 billion in net profit in 2018, on the back of a 17% decrease in provisions for bad loans.

Analysts project that Mashreq Bank will consider a 40% dividend to shareholders at AED 4 per share, and totalling AED 710.1 million for 2018. Shareholders will meet on 26 February to discuss the recommendation.

Emirates Islamic Bank came in third with AED 925 million in profits, while Ajman Bank was fourth with AED 132 million in profits in 2018.

It is worth noting that there are 19 listed banks across the UAE’s two bourses. In 2017, these banks logged a combined net profit of AED 38.2 billion, a rise from AED 35.67 billion in 2016.

Record growth

Other banks listed in the UAE are likely to report record profits in 2018 amid improving lending rates and higher spending on infrastructure projects in Dubai ahead of the Expo 2020, analysts told Mubasher, noting that Abu Dhabi is also witnessing a series of real estate and hotel projects.

The banking sector will continue to witness growth in 2019 as interest rates rise further, which in turn will result in higher revenues, they added.

The upcoming merges between small and medium-sized banks in the current competitive environment will result in lower costs for the sector as a whole and bolster its profitability, the analysts said.

Translated by: Nada Adel Sobhi