“Emirates NBD’s earnings grew by 34% in 2021, demonstrating the resilience of the group’s diversified business model. Emirates NBD has continued to fund the real economy and has been rewarded with the rebound in economic growth,” said Sheikh Ahmed Bin Saeed Al Maktoum, Chairman of Emirates NBD.
Despite interest rates remaining at historically low levels, the underlying business momentum continues to strengthen with record demand for retail financing.
The Group’s balance sheet strengthened with further improvements in deposit mix, Tier 1 capital and liquidity, while credit quality remained stable.
Total revenue for the fourth quarter increased 32% year-on-year and 13% quarter-on-quarter to MAD 6.5 billion driven by higher unfunded revenue due to increased transaction activity, growth in foreign exchange income and derivative products and a gain of 0.3 billion dirhams. regarding the sale of Dubai Bank.
“The diversified balance sheet and solid capital base remain a key strength of the group. We have used this strength to support our customers in 2021, enabling them to be part of the economic recovery,” said Hesham Abdulla Al Hassam, Vice President and Managing Director.
Net lending for the year was down 5% year-on-year as record retail funding demand was more than offset by lower corporate lending due to repayments and the impact of DenizBank’s currency translation .
The composition of deposits improved in 2021 with a growth of 38 billion dirhams in CASA [current and savings account] replacing Dh33 billion of fixed deposits.
CASA’s record balances kept the cost of funding stable. Total revenue for 2021 rose 3% year-on-year to 23.8 billion dirhams, as higher retail volumes offset the impact of low interest rates.
Spending for 2021 was up 2% year over year as business activity resumes and investment continues in international, digital and advanced analytics.
“There are a lot of positives in the solid results of the group. Rising revenues despite low interest rates, coupled with an improvement in the cost of risk to pre-pandemic levels, resulted in a profit of MAD 9.3 billion,” said Shayne Nelson, Managing Director of the group.
Impairment provisions for 2021 were 26% lower at MAD 5.9 billion due to improving economic conditions and following proactive provisioning in 2020.
Liquidity remains solid with a cash coverage ratio at 177.6% and an advances to deposits ratio at 92.5%. As of December 31, 2021, the Group’s CET-1 (common equity tier 1) ratio is 15.1%, the Tier 1 ratio is 17.2% and the capital adequacy ratio is 18.3% .
