Fujairah lender reports record 2024 profits | MEED

National Bank of Fujairah (NBF) posted a 28.9% rise in net profit before tax, reaching AED934.8m in 2024. The lender’s net profit after tax stood at AED850.1m, supported by balance sheet expansion, lower impairment charges and steady revenue growth.

NBF also recorded its highest-ever operating profit of AED1.62bn, up 2.6% year-on-year, reflecting strong performance across business segments. Total operating income rose 6.7% to AED2.4bn, driven by:

• Net interest and Islamic financing income increasing 4.8% to AED1.79bn.
• Fees and commission income rising 8.4% to AED452.7m.
• Foreign exchange and derivatives income growing 15% to AED189.1m.

The lender’s total assets grew 17.7% to AED60.9bn, supported by a 16.1% rise in loans and advances and an 18.6% increase in customer deposits. While operating expenses increased by 15.9%, largely due to digital transformation investments, NBF’s cost-to-income ratio remained at 33.3%.

Impairment provisions fell 19.7%, indicating an improvement in loan quality, though NPL (non-performing loan) levels rose slightly to 5.1%. The bank’s provision coverage ratio stood at 119.4%, ensuring capital strength against potential risks.

NBF’s capital position was reinforced through the conversion of AED1.01bn in Additional Tier 1 (AT1) capital into ordinary shares, bringing its capital adequacy ratio to 16.6%. The shift aligns with broader efforts by mid-sized banks to strengthen financial buffers amid evolving regulations.

According to KPMG, the UAE economy is projected to grow from 3.8% in 2024 to 6.7% in 2025. NBF’s credit rating of BBB+ / A-2, reaffirmed by Standard & Poor’s, signals confidence in its financial position. Reflecting this performance, the lender’s Board of Directors has proposed a 15% cash dividend distribution to shareholders.