NBAD may book more provisions

We can afford to take additional provisions if we need to. We need to get to the end of the quarter to decide Michael Tomalin, NBAD. (REUTERS)

National Bank of Abu Dhabi (NBAD), the second-largest lender by assets in the UAE, may book more provisions in the first quarter, CEO said.

The bank's impairments in the fourth quarter of 2009 totalled Dh623 million of which Dh316m were collective provisions.

Net impairment charges for the full year were Dh1.41 billion. "We can afford to take additional provisions if we need to. We need to get to the end of the quarter to decide," Michael Tomalin told reporters.

"We would take collective provisions, any specific provisions will depend on where we are at the end of the quarter," he said without giving figures.

UAE banks are likely to see an average credit growth of about 10 per cent this year, he said.

"On the credit side, there isn't a huge demand for credit and tightness won't allow any banks to grow fast, only modest growth," he added.

"But we don't want the banking system to cramp the growth of the economy. There has to be a growth in the banking market equivalent to a growth in the economy." Tomalin confirmed the bank is doing road shows for a bond issue for general corporate financing.

On Sunday, a bank executive said that NBAD plans to raise between $500m (Dh1.8bn) to $1bn in bonds.

Asked about the timeframe, he said: "It could be very quick."

 

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