Abu Dhabi Islamic Bank (Adib), a leading Islamic bank in the region, has reported a net profit of AED1,602 million ($436 million) for the first 9 months of the year from AED1,121 million in the same period last year, marking a 43% year-on-year growth.

The growth in net profit reflects the strong underlying performance across the business which led to a4% growth in total revenue to AED4,093 million compared to AED3,933 million in the same period last year.

Cost discipline was maintained amid ongoing investment in digital initiatives with expenses declining 8% and cost to income ratio improving 535basis points to 42.2%.

Adib continued to demonstrate strengths and depths in its balance sheet with a 4% growth YTD in total assets, driven by a 6% growth in deposits and a 2% growth in gross customer financing.

Adib has also announced a new 2025 strategy to drive long-term growth and shareholder value, with a vision to become the world’s most innovative Islamic bank, and a new purpose to serve as a lifelong partner for customers, colleagues and community.

Jawaan Awaidah Al Khaili, Chairman, said: “The recovery from the pandemic continues to drive positive consumer sentiment as reflected in our strong performance across all business lines. We continued to follow a positive growth trajectory achieving a 43% year-on-year growth in net profit driven by a 4% growth in revenues.”

“Adib’s financial performance reflects the continued success of our growth strategy and our ability to adapt to a challenging environment. It is particularly pleasing that we have done so without compromising on our commitment to offer best-in-class customer service, as is evidenced in the fact that we now serve over 1 million customers across multiple client segments.

“We were also honoured that Adib once again has taken the lead in the UAE banking sector by launching new digital initiatives including the launch of the world’s first Islamic digital proposition targeting youth between the age of 8 to 18 and the use of facial recognition for instant and secure account opening,” he added.

“We are focused on the priorities we outlined as part of our 5-year strategic review. We are now embarking on a new journey with a renewed purpose and a revamped vision to be the world’s most innovative Islamic bank.  Our redefined strategy brings considerable focus on innovating new products that will allow us to support customers in all important financial stages in their lives while attracting new segments where we can grow profitably building on our strong brand and market position,” Al Khaili noted.

“We will continue with our digital transformation strategy to build a future-proof bank by rigorously simplifying and centralizing our operating model that will enable us to focus on clients and work more efficiently.

“Looking ahead and despite ongoing uncertainties, we believe that the UAE economy has the potential to have extremely robust, multi-year growth supported by positive consumer sentiment around the end of the pandemic.  Against this backdrop, we believe we are well positioned for a period of sustained growth for the last quarter of the year, leveraging on our strong market position, strategic initiatives and operational resilience,” Al Khaili concluded.

Mohamed Abdelbary, Group Chief Financial Officer, said: “Our first 9 months of 2021 results provide a good summary of where Adib stands today, a growing bank that is attracting new customers based on a high-quality banking experience and trusted corporate values which place customers’ needs first. In Q3 2021, Adib has continued to deliver strong growth in revenues of 5% driven by higher income from financing and a growth in investment income. This has resulted in a strong 43% year-on-year growth in our net profit which led to a healthy return on equity of 13%.”

“Despite a low rate market environment our net profit margins ‘NPMs’ was at 3.32% helped by the positive impact of the low cost of fund that is supported by higher CASA balances. Our liquidity also remains strong, with an advances-to-deposits ratio of 78.9%. We therefore fully expect to be able to support our growth ambitions in the most effective and efficient manner.

“Despite heavy investment in core areas that will help us achieve further growth in the future, including enhancing customer experience and advancing our digital capabilities, we demonstrated a strong expense discipline with the Group’s cost-to-income ratio improving by 535 basis points to 42.2%.  This is in line with management targets and it will enable us to invest further to support our future growth.

“Throughout the period, we continued to demonstrate risk discipline, with our asset quality broadly stable underpinned by a prudent risk approach and recoveries. Our balance sheet foundation remains robust, with solid liquidity and funding ratios, and a strong capital position with a CET1 at 13.8%,” Abdelbary added. – TradeArabia News Service