The Chief Financial Officer of the Abu Dhabi Islamic BankMohamed Abdel-Bari, said the bank will benefit from the rise in interest rates, especially since the current year is exceptional in raising interest rates, and every 50 basis point interest increase translates into an increase. in profits of 100 million dirhams per year.
In an interview with Al Arabiya on the sidelines of the IMF and World Bank meetings, Abdel Bari added that he did not expect an increase in allocations for non-performing loans in the third quarter of 2022.
He explained that the bank’s cost of financing will increase from the current 35 basis points to 50 basis points by the end of 2022.
Mohammed Abdul Bari stated that 75% of client deposits in the Islamic Bank of Abu Dhabi are in checking and savings accounts at a very low cost of financing and 76% of the financing for clients is at annually revalued interest rates. which makes the bank benefit from the high interest rates.
Abu Dhabi Islamic Bank’s Director General of Financial Affairs added that the current period has not seen an increase in requests for rescheduling of facilities or non-performing loans, in particular that 80% of Abu Dhabi Islamic’s retail portfolio is concentrated in customers who are citizens, and this represents a safety factor for the bank and for businesses, funding from the public sector, government and defense increases, so there is no pressure in the sector.
He explained that provisions are not expected to increase in the third quarter of 2022, as the situation is positive.
Muhammad Abdul-Bari said that the total loan portfolio increases by 10% annually and the percentage of liquidity in the public sector has increased, which represents an opportunity to increase repayment rates.
Abu Dhabi Islamic Bank’s chief financial affairs chief added that Abu Dhabi Islamic Bank’s net profit is one of the highest rates in the market and is expected to rise in conjunction with rising interest rates.
Abu Dhabi Islamic Bank achieved a 45% increase in net profits for the second quarter of 2022 to record 726 million dirhams, or 198 million dollars, compared to 501 million dirhams recorded in the same quarter of 2021. .
The profits of the Abu Dhabi Islamic Bank also rose to AED 1.4 billion by the end of the first half of 2022, a 30% increase from the AED 1.108 billion profits made in the same period of 2021.
The bank attributed the increase in earnings in the first half to the 38% drop in provisions for losses on loans and investments, to reach AED 227.4 million, compared to AED 366.8 million compared to the first half of 2021. .
The bank’s revenues in the first half of 2022 grew by 7%, to reach 2.8 billion dirhams, compared to 2.644 billion dirhams in the first half of last year.
