NBF recorded year-on-year growth of 122.5% to close the nine month period with a
net profit of AED 513.2 million compared to AED 230.7 million in the corresponding
period of 2022. On the back of a robust Q3 2023 performance, NBF posted a net
profit of AED 181.0 million in the third quarter of 2023, a rise of 125.8% over the
corresponding quarter of 2022, which reflects the bank’s high level of resilience in its
core business, an improvement in the impairment provisions and the high interest
rate environment.
Aided by higher net interest income and net income from Islamic financing and
investment activities and fee income, NBF posted an operating profit of AED 1.2
billion for the nine month period, a substantial increase of 26.6% compared to AED
932.5 million in the corresponding period of 2022 and up 22.3% for the three month
period ended 30 September 2023 over the corresponding period of 2022.
Operating income reached AED 1.7 billion for the nine month period ended 30
September 2023, up 27.7% compared to AED 1.3 billion in the corresponding period
of 2022, reflecting the benefit from increasing interest rates and enhanced asset and
liability management. Operating income growth of 24.1% was recorded for the three
month period ended 30 September 2023 over the corresponding period of 2022.
Net interest income and net income from Islamic financing and investment
activities grew 47.0% to AED 1.3 billion for the nine month period ended 30
September 2023 compared to AED 855.4 million in the corresponding period
of 2022. It was up 29.1% for the three month period ended 30 September
2023 compared to the corresponding period of 2022.
Net fees, commission and other income grew 2.6% to AED 310.4 million for
the nine month period ended 30 September 2023 compared to AED 302.7
million in the corresponding period of 2022.
Classified as: NBF External
Foreign exchange and derivatives income stood at AED 119.3 million for the
nine month period ended 30 September 2023 compared to AED 142.5 million
in the corresponding period of 2022.
Operating expenses increased by 30.3%, reflecting NBF’s investments in its
businesses, systems, infrastructure and people. These investments include a set of
digital initiatives to further enhance the focus on exceptional customer service
through digital adoption and innovation. Further, the impact of inflation continued to
affect our operating expenses. NBF’s cost-to-income ratio stood at 30.0% compared
to 29.4% in the corresponding period of 2022; remaining in the mid-industry range
reflecting on-going cost discipline.
NBF maintained its policy of prudent and transparent recognition of problem accounts
taking into consideration the new credit risk standards being introduced by the
Central Bank of the UAE and the risk of recessionary trends. NBF booked net
impairment provisions of AED 667.6 million for the nine month period ended 30
September 2023 compared to AED 701.8 million in the corresponding period of 2022.
During the period, the bank’s impairment reserve substantially reduced by 50.9% to
AED 82.6 million compared to AED 168.2 million as at 31 December 2022. Total
provision coverage ratio improved to 124.1% compared to 101.5% as at 31
December 2022. The NPL ratio improved to 5.4% compared to 6.9% as at 31
December 2022, as the bank successfully progressed the resolution of a few
exceptional exposures.
Loans and advances and Islamic financing receivables rose by 3.0% to reach AED
27.7 billion compared to AED 26.9 billion at 2022 year-end.
Investments and Islamic instruments increased by 16.7% to reach AED 7.4 billion
compared to AED 6.3 billion at 2022 year-end, up by 25.2% from 30 September
2022 evidencing the deployment of a portion of liquidity towards a high-quality
investment book offering good risk-to-return as well as access to market liquidity.
The capital adequacy ratio (CAR) stood at 18.9% (Tier 1 ratio of 17.7% and CET 1
ratio of 14.1%) compared to 18.6% (Tier 1 ratio of 17.4% and CET 1 ratio of 13.6%)
at 2022 year-end and is being maintained at this level to support the bank’s ability to
grow and meet any challenges that may arise from the swiftly evolving global
economy.
Classified as: NBF External
Customer deposits and Islamic customer deposits increased by 4.1% to reach AED
37.2 billion compared to AED 35.7 billion at 2022 year-end, and were up by 13.8%
from 30 September 2022. Current and Saving Accounts (CASA) deposits stood at
40.7% of total customer deposits softening the impact of increasing rates for fixed
term products on deposit costs.
Total assets rose by 4.9% to reach AED 50.0 billion compared to AED 47.6 billion at
2022 year-end, up by 12.6% from 30 September 2022.
Ample liquidity has been maintained with lending to stable resources ratios at 70.4%
(2022: 72.1%) and eligible liquid assets ratio (ELAR) at 26.1% (2022: 24.9%), well
ahead of Central Bank of the UAE’s minimum requirements.
Return on average assets improved to 1.4%, up from 0.7% for the corresponding
period in 2022.
Return on average equity improved to 11.2%, up from 5.4% for the corresponding
period in 2022.
Dr. Raja Easa Al Gurg, Deputy Chairperson said:
“These pleasing results demonstrate the on-going impact of our business strategy,
resilience in our core business and sound improvement in asset quality. Good growth
across our operating and net performance augurs well for the results of the full year and
beyond, despite the numerous challenges in the global economy and the prevailing
macroeconomic uncertainty.
Spurred by strong liquidity conditions underpinned by high oil prices, foreign capital
inflows and strong growth in oil and non-oil sectors, the UAE’s economic growth forecast
has been revised for 2023 and 2024 to expand at 3.4 per cent and 3.7 per cent
respectively.
Benefitting from this positive economic outlook, NBF is geared up and well placed
through the strength of its diversified balance sheet for growth in the current interest
rate cycle.
Classified as: NBF External
Looking ahead, NBF will continue to focus on opportunities to enhance value creation,
diversify revenue streams, digital initiatives for exceptional customer service, cost
discipline and risk management and compliance practices. In parallel, the bank is
upholding heightened focus on environmental, social and governance [ESG] activities
which remain vital to the NBF franchise for a sustainable future.”
About National Bank of Fujairah PJSC:
Incorporated in 1982, National Bank of Fujairah PJSC (NBF) is a full services corporate
bank with strong corporate and commercial banking, treasury and trade finance
expertise as well as an expanding suite of personal banking options and Shari’ah
compliant services. Leveraging its deep banking experience and market insight within
Fujairah and the UAE, NBF is well-positioned to build lasting relationships with its clients
and help them achieve their business goals.
NBF’s key shareholders include the Government of Fujairah, Easa Saleh Al Gurg LLC and
Investment Corporation of Dubai. Rated Baa1 / Prime-2 for deposits and A3 for
counterparty risk assessment by Moody’s and BBB+ / A-2 by Standard & Poor’s, both
with a stable outlook, the bank is listed on the Abu Dhabi Securities Exchange under the
symbol “NBF”. It has a branch network of 14 across the UAE.
