• Excellent performance uplift in 9M 2024 compared to 9M 2023 Net profit after tax of AED 2,231 million up 26.5% on a pre-tax basis (15.2% on a post-tax basis) versus the prior comparative period
  • Prudent provisioning for expected credit losses Net impairment loss was AED 697 million. Coverage ratio at 96.61%, up 1,601 bps compared to 9M 2023.
  • Cost to income ratio Market leading cost to income ratio at 24.44%
  • Strong loan growth whilst maintaining healthy liquidity, funding and capital ratios Gross loans were AED 97.3 billion, an increase of 9.5% compared to 31 December 2023

Dubai: Commercial Bank of Dubai (CBD) today reported its financial results for the first nine months of 2024.

Solid sustainable high quality result with sound business momentum

CBD delivered an excellent net profit after tax result of AED 2,231 million for the first nine months of 2024, up 26.5% on a pre-tax basis (up 15.2% on a post-tax basis) compared to the corresponding period in 2023. Strong growth in loans during the first nine months of 2024 resulted in a solid net interest outcome, which was supported by non-funded income and lower cost of risk that more than offset higher expenses and the corporate tax charge. High global market interest rates during the first nine months of 2024 contributed to the solid net interest income outcome. UAE business activity bolstered by economic incentives, population growth and business confidence remained constructive and is forecast to remain positive looking ahead. The public sector strategic positioning, strategic investments, economic diversification and broad-based growth, especially in non-oil sectors is expected to underpin continued business performance.

Commenting on the Bank’s performance, Dr. Bernd van Linder, Chief Executive Officer, said, “CBD has delivered an excellent result attributable to strong loan growth with higher revenues at outstanding returns and with significantly improved asset quality. Our net profit after tax for 9M 2024 was a record AED 2,231 million, above the prior comparative period by 26.5% on a pre-tax basis, attributable to strong customer activity and overall business performance. The Bank remains focused on the disciplined execution of its strategy and is well placed to continue to achieve our strategic objectives and high-quality performance for the periods ahead.

In Q3 2024, CBD launched dedicated accounts for Virtual Asset Service Providers (VASPs). The introduction of banking services for VASPs aligns with our strategic vision to support the digital economy and foster a robust regulatory environment that promotes growth and stability. As the Bank that is backing the nation’s ambition, our efforts also contribute to promoting Dubai as an international hub for Virtual Assets and developing the digital economy in the UAE.

Additionally, in October 2024, CBD issued USD 500 million Regulation S Registered 5-year senior unsecured bond under the Bank’s EMTN Programme. This successful issuance highlights the strong CBD brand value and market recognition. Furthermore, CBD was recognized by the Dubai Chamber of Commerce as one of 27 companies leading the way in adoption of sustainable business and awarded its Environment, Social and Governance (ESG) label, which demonstrates the enduring resolve of the Bank in this key area.”

9M 2024 results:

  • Net profit after tax was AED 2,231 million, 26.5% above the prior comparative period on a pre-tax basis (15.2% on a post-tax basis)
  • Operating income was AED 4,164 million, up 12.1% driven by net interest income, fees and commissions
  • Operating expenses were AED 1,018 million, up by 15.6%
  • Operating profit was AED 3,147 million, up by 11.0%
  • Net impairment loss was AED 697 million, down by 22.5%
  • Corporate tax expense of AED 219 million

As at 30 September 2024:

  • Capital ratios remained strong with the capital adequacy ratio (CAR) at 16.56%, Tier 1 ratio at 15.42% and Common Equity Tier 1 (CET1) ratio at 13.37%, well in excess of regulatory requirements
  • Gross loans were AED 97.3 billion, an increase of 9.5% compared to 31 December 2023
  • Advances to stable resources ratio (ASRR) stood at 86.00%, improved by 125 bps compared to 31 December 2023

Income Statement

Operating income for 9M 2024 was AED 4,164  million, up 12.1%, attributable to an increase in Net Interest Income (NII) by 7.3% on strong loan growth during the first nine months of 2024 and high market interest rates with Other Operating Income (OOI) up 23.8%.

Operating expenses were AED 1,018 million, with the increase primarily driven by inflation, investments in digitisation, technology, business growth, governance and regulatory compliance. The cost-to-income ratio remains strong at 24.44%.

  (AED Million)

Income statement

9M 24

9M 23

 Var

Q3 24

Q2 24

 QoQ Var 

Net interest income

2,849

2,654

7.3%

943

947

(0.4%)

Other operating income

1,315

1,062

23.8%

511

391

30.7%

Total income

4,164

3,716

12.1%

1,454

1,338

8.7%

Operating expenses

1,018

881

15.6%

374

329

13.7%

Operating profit

3,147

2,835

11.0%

1,081

1,009

7.1%

Expected credit losses

697

899

(22.5%)

226

184

22.8%

Net profit before tax

2,450

1,936

26.5%

855

825

3.6%

Corporate tax expense

219

-  

100.0%

76

74

2.7%

Net profit after tax

2,231

1,936

15.2%

779

751

3.7%

Balance Sheet

Total assets were AED 140.2 billion as at 30 September 2024, an increase of 8.7% compared to AED 129.0 billion as at 31 December 2023.

Net loans and advances were AED 91.7 billion, registering an increase of 10.1% compared to AED 83.3 billion as at 31 December 2023.

Customers’ deposits were AED 98.7 billion as at 30 September 2024, representing an increase of 11.8% compared to AED 88.3 billion as at 31 December 2023. Low-cost CASA constituted 49% of the total customer deposit base, while the loan-to-deposit ratio stood at 93%.

  (AED Million)

Balance sheet

Sep 24

Sep 23

YoY Var

Sep 24

Jun 24

QoQ Var

Gross loans and advances

    97,273

    88,478

9.9%

    97,273

    95,197

2.2%

Allowances for impairment

      5,527

      5,375

2.8%

      5,527

      5,589

(1.1%)

Net loans and advances

91,746

83,103

10.4%

91,746

89,608

2.4%

Total assets

140,217

126,237

11.1%

140,217

141,256

(0.7%)

Customers' deposits

    98,682

    86,442

14.2%

    98,682

    99,831

(1.2%)

Total Equity

    16,772

    14,951

12.2%

    16,772

    15,843

5.9%

Asset Quality

The non-performing loan (NPL) ratio decreased markedly to 4.96%, down from 6.46% at the end of 2023. The net impairment charge totaled AED 697 million for the first nine months of 2024. The coverage ratio increased by 1,335 bps to 96.61% (December 2023: 83.26%) and was 133.09% inclusive of collateral for stage 3 loans. As at 30 September 2024, total allowances for impairment (covering loans and advances and unfunded exposures) amounted to AED 5,702 million.

Liquidity and Capital position

The Bank’s liquidity position remained robust with the advances to stable resources ratio at 86.00% as at 30 September 2024 (December 2023: 87.25%), compared to the UAE Central Bank maximum of 100%.

CBD’s capital ratios were strong with the capital adequacy ratio (CAR) at 16.56%, Tier 1 ratio at 15.42% and Common Equity Tier 1 (CET1) ratio at 13.37%. All capital ratios were well above the minimum regulatory thresholds mandated by the UAE Central Bank.

      (%)

Key ratios %

9M 24

9M 23

YoY Var
(bps)

Q3 24

Q2 24

QoQ Var
(bps)

Return on equity (before tax)

23.51%

21.38%

213

24.57%

25.17%

(60)

Return on assets (before tax)

2.43%

2.13%

30

2.43%

2.42%

1

Cost to income ratio

24.44%

23.72%

72

25.71%

24.56%

115

Non-performing loans (NPL)

4.96%

6.49%

 (153)

4.96%

5.56%

 (60)

Provision coverage

96.61%

80.60%

1,601

96.61%

89.61%

700

Loan-to-deposit ratio

92.97%

96.14%

 (317)

92.97%

89.76%

321

Advances to stable resources

86.00%

87.23%

 (123)

86.00%

83.63%

237

Capital adequacy ratio

16.56%

16.80%

 (24)

16.56%

16.05%

51

Tier 1 ratio

15.42%

15.65%

 (23)

15.42%

14.92%

50

CET1 ratio

13.37%

13.34%

3

13.37%

12.83%

54

Ratings

Agency

Rating

Outlook

Date

Fitch Ratings

A-

Stable

Sep-24

Moody's

Baa1

Stable

May-24

About CBD

The Bank was incorporated in Dubai, United Arab Emirates in 1969 and is registered as a Public Joint Stock Company (PJSC).

The Bank is listed on the Dubai Financial Market (DFM) and is majority owned by UAE Nationals, including 20% by the Investment Corporation of Dubai (ICD). The Bank employs nearly 1,200 staff and offers a wide range of conventional and Islamic banking products and services to its institutional, corporate and personal banking customers through a network of 13 branches. Moreover, the Bank has invested in an extensive network of 163 ATMs/CDMs.

For further information, kindly contact: CBD Investor Relations @ investor.relations@cbd.ae