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Abu Dhabi Islamic Bank Reports Strong Financial Growth

ADIB reported a 53 percent increase in net profit for the first nine months of 2023.

Abu Dhabi Islamic Bank (ADIB) announced an impressive 53 percent growth in net profit for the first nine months of 2023, reaching Dh3.75 billion compared to Dh2.5 billion in 2022. 

This remarkable growth was also reflected in the net profit for Q3 2023, which reached Dh1.4 billion, marking a 41 percent increase over Q3 2022.

Revenue and Income Diversification:

Revenue for the first nine months of 2023 saw a substantial improvement, rising by 48 percent to Dh6.7 billion, compared to Dh4.5 billion in the previous year. 

This growth was attributed to excellent income diversification and strong performance across all business segments and product lines.

Funded and Non-Funded Income:

Funded income showed a remarkable increase, surging by 61 percent to Dh4.5 billion, compared to Dh2.8 billion in the corresponding period of the previous year. Higher volumes and improved margins drove this gain. 

Non-funded income also increased by 28 percent, reaching Dh2.2 billion in the first nine months of 2023, with a 24 percent growth in fees and commissions.

The bank effectively managed its cost-to-income ratio, achieving a notable improvement of 5.0 percentage points to 32.6 percent, compared to 37.6 percent in the corresponding period. 

This improvement was primarily driven by income growth and enhanced productivity.

Impairments and Asset Quality:

Impairments increased by 62 percent to Dh571 million for the first nine months of 2023. However, the non-performing asset ratio improved to 6.6 percent, the lowest since Q1 2020. 

This improvement was attributed to active management of the legacy portfolio and strong underwriting standards. The coverage ratio, including collaterals, improved by 9.0 percentage points to 131.4 percent.

Asset and Deposit Growth:

Total assets witnessed a 25 percent increase, reaching Dh184 billion. This growth was driven by a 14 percent increase in gross financing and a 21 percent increase in investments. 

Customer deposits rose by 28 percent, reaching Dh152 billion, with Current and Savings Accounts (CASA) growing by 13 percent, making up 66 percent of total deposits.

Strong Capital and Liquidity Position:

ADIB maintained a strong capital position, with a Common Equity Tier 1 ratio of 13.36 percent and a total Capital Adequacy Ratio of 18.03 percent. 

The bank’s liquidity remained healthy and within regulatory needs, with advances to a stable funding ratio of 78.6 percent and an eligible liquid asset ratio of 18.8 percent.

Optimism for Future Growth:

ADIB’s leadership expressed optimism about the future as they enter the last quarter of 2023 with a strong financial position, capital and liquidity ratios, stable asset quality, and improved returns. 

This strong foundation positions the bank to capture new business opportunities and identify areas for future growth.

Jawaan Awaidah Al Khaili, Chairman of ADIB, said, “ADIB achieved another record performance in the first nine months of 2023, with net profit growing 53 percent, achieving a new high of Dh3.75 billion, surpassing what was achieved in the full year of 2022.”

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