First Abu Dhabi Bank crosses Dh10b in H1 profit on strong growth

24/07/2025 03:45 AST

First Abu Dhabi Bank (FAB), the UAE's largest lender and one of the world's top-rated financial institutions, has reported a record net profit of Dh10.63 billion for the first half of 2025, marking a 26 per cent year-on-year increase and crossing the Dh10 billion milestone for the first time in a six-month period.

The remarkable performance was underpinned by broad-based growth across business lines, accelerated customer acquisition, and expanding regional and global connectivity, the lender said in a statement.

Total operating income rose 16 per cent year-on-year to Dh18.31 billion, driven by diversified revenue streams. Net interest income edged up two per cent to Dh9.96 billion, while non-interest income surged by 41 per cent to Dh8.35 billion, fueled by strong deal origination, rising fee and commission income, and robust foreign exchange and investment activity. Profit before tax reached Dh12.83 billion, a 29 per cent rise from the year-ago period.

Return on Tangible Equity (RoTE) stood at 20.5 per cent, well above the bank's medium-term guidance of over 16 per cent. Earnings per share increased by 27 per cent to Dh0.93. Net profit for the second quarter alone rose 29 per cent year-on-year to Dh5.51 billion, reflecting the bank's consistency in delivering growth at scale.

FAB's balance sheet remains a pillar of strength, with total assets growing 11 per cent year-to-date to Dh1.34 trillion. Loans and advances increased seven per cent to Dh568 billion, while customer deposits climbed four per cent to Dh813 billion, showing healthy traction across both wholesale and retail segments.

Asset quality improved, with the non-performing loan ratio declining to a multi-year low of 2.84 per cent. FAB's Common Equity Tier 1 (CET1) ratio was a solid 13.4 per cent, and its liquidity coverage ratio stood at 152 per cent. The bank also continues to hold the strongest combined credit ratings in the region (AA- or equivalent).

Group CEO Hana Al Rostamani said the exceptional results reinforce FAB's status as the UAE's global bank and a trusted partner in national development. "We achieved new highs in the first half of 2025, driven by scale, connectivity, and AI-powered innovation. We are embedding AI into every aspect of our operations - from client onboarding and credit analytics to customer engagement and internal processes," she said.

Notably, FAB rolled out Microsoft 365 Copilot across the organisation, introduced tools like Voice Concierge and AI-driven financial planning platforms, and launched a Board AI Observer. These initiatives, according to the CEO, are already delivering measurable improvements in efficiency and client satisfaction.

FAB also became the first Mena bank to join China's Cross-border Interbank Payment System (CIPS) as a direct participant, a move expected to deepen its East-West connectivity and enable new corridors for cross-border flows.

Group CFO Lars Kramer said FAB's consistent and disciplined execution, supported by diversified growth, robust risk management, and targeted AI investments, has positioned the bank for long-term success. "We delivered double-digit revenue growth across all divisions, showing strong client engagement in a dynamic market. We're also proud to have launched the region's first blockchain-based digital bond, further underlining our role in shaping the future of capital markets," Kramer said.

The bank's divisions recorded solid performances. Investment Banking and Markets saw a 17 per cent increase in revenue, backed by leadership in capital markets and landmark transactions, including financing one of the region's largest data centre projects. Wholesale Banking revenue rose 12 per cent, driven by increased activity across key economic sectors and new mandates. Personal, Business, and Wealth Banking delivered 12 per cent growth, with assets under management in private banking and wealth rising 61 per cent.

Internationally, FAB's franchises in the UK, France, Switzerland, and Saudi Arabia posted strong performance, with loans and deposits growing 28 per cent and 24 per cent year-on-year, respectively.

On the ESG front, the bank facilitated Dh318 billion in sustainable and transition finance by mid-2025, achieving 64 per cent of its Dh500 billion 2030 target. It maintains top-tier ESG ratings (MSCI AA, Refinitiv top 6 per cent globally).

Khaleej Times