Dubai's Emirates NBD Q1 profit rises 60%, beats estimates

Emirates NBD (ENBD), Dubai's largest lender, posted a 60 per cent rise in first-quarter net profit on Wednesday, beating analysts' forecasts as income from lending, fees and other products increased and provisions dropped.

The earnings growth is the steepest among the five banks that have reported so far in the UAE.

The lender, 55.6-per cent owned by state fund Investment Corp of Dubai, made a net profit of Dh1.67 billion  ($454.67 million) in the three months to March 31, the bank said. This is up from Dh1.04 billion  in the same period of 2014.

That was ahead of the average estimate of four analysts polled by Reuters for a fourth-quarter net profit of Dh1.46 billion.

ENBD's performance has been lifted in recent quarters by strength in Dubai's economy, where diversification has helped insulate banks from sluggish oil markets.

Net interest income reached Dh2.49 billion, up by 11 per cent from the same period of last year. It cited an improvement in the performance of Islamic and retail assets and lower cost of funds for the climb.

The bank has been helped by an easing of debt woes. Emirates NBD's fourth-quarter profit surged 82 per cent helped by its reclassification of its Dubai World debt as performing.

Impairment allowances reached Dh1.1 billion at the end of the quarter, an improvement of 14 per cent from the same period of last year.

A drop in impairment charges helped lift the bank's coverage ratio for bad loans to 103.9 per cent at March-end, from 100.3 per cent in the earlier quarter.

Bank forecasts 5% loan growth for 2015

Emirates NBD expects loan growth to be around 5 per cent in 2015, it told Reuters on Wednesday.

Loan growth climbed by 4 per cent in the first quarter of the year, up from the same period of last year, the bank said in its first-quarter earnings statement, released earlier in the day.

In an emailed response to questions, a spokeswoman for ENBD said it forecast 2015 loan growth to be "in the 5 per cent area."

The bank expected loan growth to be between 5 and 7 per cent in 2015, chief executive Shayne Nelson told reporters in February.

ENBD posted a 60 per cent rise in first-quarter net profit on Wednesday, beating analysts' forecasts as income from lending, fees and other products increased and provisions dropped.