UAE’s NBAD Q4 profit misses forecasts on impairments

UAE’s NBAD Q4 profit misses forecasts on impairments

Q4 net profit AED 724M vs AED732 million a year ago; Analysts forecast profit of AED756.4 million for Q4; Q4 impairment charges AED482 million vs AED424 million

January 31, 2012 3:05 by Reuters

National Bank of Abu Dhabi on Tuesday posted a one percent decline in fourth quarter net profit, missing analysts’ forecasts, as the UAE lender was hurt by rising impairment charges.

The country’s largest bank market value, made a net profit of 724 million dirhams ($197.27 million) for the fourth quarter, compared with 732 million dirhams for the year-ago period, it said in a statement.

Full year profit stood 3.71 billion dirhams, up 0.7 percent from 3.68 billion dirhams year-ago.

Analysts forecast an average profit of 756.43 million dirhams in a Reuters poll earlier this month.

“2011 has been one of the most difficult years ever in global banking. The region has also been affected by the Arab Spring, low interest rates and the Euro crisis,” Michael Tomalin, NBAD’s chief executive officer said in the statement.

Net impairment charges for the fourth quarter stood at 482 million dirhams, up 13.7 percent over the same quarter last year. Full year charges reached 1.49 billion dirhams.

“This year we have been particularly cautious regarding provisions, both for our properties and our credit portfolio, taking the general provisions to performing credit risk-weighted assets to the 2014 Central Bank target of 1.5 percent,” Tomalin said.

Loans and advances stood at 159.5 billion dirhams in 2011, up 16.6 percent over 2010, while deposits rose 23.3 percent to reach 151.8 billion dirhams.

NBAD plans to open its first office in Malaysia and a representative office in Shanghai in the first quarter this year. (Reporting By Stanley Carvalho; Editing by Dinesh Nair) *image from topnews.ae