The performers and non performers among banks in the UAE
With reporting season for UAE banks' 2008 annual reports coming to a close, it's worth a look at which fared well and which were more battered by the global financial storm.
Obviously, 2008 performance is no indication that they'll continue to excel in 2009 (and many banks had dire final quarters and a poor start to this year), but at the moment the safe bets seem to be:
Emirates NBD: Though net profit for 2008 was down 7% on 2007 to AED3.6bn ($980m), it was actually up 41% year on year before impairments on investments and other securities. And with all this talk of mergers within the banking sector, it seems Emirates NBD may be one of the acquirers. Chairman Ahmed Humaid Al Tayer says the current environment will allow it to "further strengthen our position through capitalising on opportunities that may be presented to us".
United Arab Bank: This Islamic bank posted a net profit of AED250.2m ($68.1m) - an 18.4% rise on 2007, which Bertand Giraud, the group's chief exec described as "satisfactory".
Union National Bank: Profits were up 22.2% to AED1.44bn ($391.3m) for 2008 and it increased staff costs from AED336m in 2007 to AED413m last year. Concerns have been raised recently about its capital ratio, however.
National Bank of Abu Dhabi: It may have received a cash injection from the government in February, but its net profit for 2008 was up 21% on 2007 to over AED3bn ($816m). It's already stated its intention to "dramatically increase" the number of Emiratis it takes on this year, including 100 management trainees.
Abu-Dhabi Islamic Bank:A 60% slump in Q4 profits meant that it was only 10.7% up on 2007 for the full year, but a state cash injection has shored up the balance sheets. So far this year, it has already recruited 150 graduates.
The not so safe options:
First Gulf Bank: Profits surged by 50% in 2008, to over AED3bn ($816m), mainly driven by an increase in its Islamic banking income. But the bank still cut "scores of jobs" in December as the crisis took hold, although it insisted these were mainly among outsourced functions.
Mashreqbank: Following a 13.6% slide in net profit for 2008, Mashreqbank decided to trim its workforce by 4% in February, or around 175 employees.
Investbank: Abu-Dhabi's Investbank had a terrible year, posting profits that were down 98.4% on 2007, due to a massive fourth quarter loss.
Dubai Islamic Bank: It may have only posted a small decline in year-on-year profits for 2008, but DIB hasn't had a great 2009 so far. It's considering raising AED3bn ($816m) in fresh capital and using emergency government deposits to shore up its balance sheets. It's facing writedowns on the falling value of its investments.
Abu-Dhabi Commercial Bank: Registered a AED140m ($38m) loss in the final quarter of 2008, contributing to its full year profit falling from over AED2bn ($544.5m) in 2007 to AED1.36bn ($369.7m) last year.
