Contrasting results for merging Abu Dhabi lenders NBAD and FGB
Abu Dhabi lenders First Gulf Bank (FGB) and National Bank of Abu Dhabi (NBAD), which are merging to create one of the largest banks in the Middle East and Africa, posted contrasting fourth-quarter results on Tuesday.
FGB, Abu Dhabi’s third-largest lender by assets, reported an 11 percent fall in net profit for the three months to Dec. 31, narrowly beating analysts’ expectations but was outshone by a 28 percent profit jump at NBAD.
The two banks, which are due to combine as a single entity from April 1, will disclose combined results from the second quarter onwards, NBAD Chief Financial Officer James Burdett said on an analysts’ call on Tuesday.
NBAD, the emirate’s largest lender by assets, reported net profit of 1.33 billion dirhams in the same period, helped in part by higher lending fees and insurance sales. The result was in line with forecasts from three analysts polled by Reuters.
FGB’s net profit of 1.53 billion dirhams ($416.6 million) compared with 1.72 billion dirhams a year earlier and was hit by a 1 percent dip in net interest and Islamic financing income to 1.64 billion dirhams and a 63 percent drop in other operating income to 250 million dirhams. It did not give reasons for the 63 percent decline.
The FGB board has proposed a cash dividend of 1 dirham per share for 2016, unchanged from a year earlier.
NBAD proposed a 2016 cash dividend of 0.45 dirhams per share, unchanged from the payout for 2015.