First Abu Dhabi Bank (FAB) reported a rise in first-quarter profit, fueled by steady lending growth and strong fee income. However, escalating geopolitical conflicts weighed on client activity toward the end of the quarter. FAB reported steady growth in operating income through its higher net interest income and strong non-interest revenue streams.
The bank's loan growth remained its main source of income because it operated during a period of stable interest rates and strong credit demand. The business received additional revenue support from its fee-based operations and its trading revenue.
According to the latest reports, operating income rose 6% year-on-year to Dh9.34 billion, and operating profit rose 5% to Dh7.22 billion. The company reported a net profit of Dh5.01 billion, with a return on tangible equity of 17.8%.
Lars Kramer, Group Chief Financial Officer, said, “Our first-quarter performance demonstrates the underlying strengths of our diversified franchise, with consistent execution through a period of heightened regional tensions and market volatility. “ He further added that “fee-based and trading income helped offset softer activity. Mitigating the impact of dampened client flows towards the end of the quarter.”
Looking ahead, FAB's total assets grew by 6% year-to-date to Dh1.49 trillion. This surpassed its all-time high of $400 billion for the first time. Loans rose 8% to Dh668 billion, while customer deposits increased 4% to Dh871 billion. Asset quality improved, with the non-performing loan ratio declining to 2.1%.
First Abu Dhabi Bank achieved comprehensive results. Thus, decreasing its dependency on specific revenue sources. The company expects its current uncertainty to continue due to geopolitical threats.
However, FAB will focus on digital investments while managing costs and pursuing controlled expansion. The company's capital strength, combined with its various business segments, will enable it to maintain steady operations throughout the coming quarters.
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