Emirates NBD, the largest bank in Dubai in terms of assets, announced a flat third-quarter net profit on Thursday. This was because greater impairment charges and investments to spur future growth outweighed an increase in net interest revenue.
According to LSEG data, net profit for the July–September period was 5.2 billion dirhams ($1.42 billion), the same as the equivalent 2023 period but short of the mean analyst projection of 6 billion dirhams.
While non-funded income dropped 15% to 3 billion dirhams, the bank, primarily owned by the Dubai government, recorded an 8% increase in net interest income to 8.5 billion dirhams.
Since most regional currencies are based on the U.S. dollar, most Gulf central banks lowered their benchmark interest rates last month after the Federal Reserve lowered U.S. rates by half a percentage point.
In anticipation of interest rate reduction this year, the Dubai lender stated earlier this year that it is concentrating on increasing its non-funded income. In the third quarter, total assets increased 14% year over year to 931 billion dirhams, while gross loans increased 6% to 508 billion and deposits increased 13% to 624 billion.
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