FAB FY20 profit drops 16 pc to AED10.55 bn; Sayegh to retire soon

By CL Jose

Dividend payout ratio to be 77 pc; assets down 4 pc since Sept

ABU DHABI/January 26-2021: First Abu Dhabi Bank, UAE’s largest bank by assets, on Tuesday posted a 16 per cent drop in its net profit for 2020, from AED12.59 billion to AED10.55 billion a year ago.

The bank’s board has proposed a cash dividend of 74 per cent of its share capital at AED10.92 billion, which will see the bank give away AED8.08 billion or almost of 77 per cent of its net profit this year to its shareholders as cash dividend.

Andre Sayegh to retire

The bank has also said its chief executive officer, Andre Sayegh (seen in the picture), will be stepping down next month and the post will be filled by Hana al-Rostamani, currently deputy group CEO.

The bank saw 17.52 per cent drop in its interest income during the year, from AED24.37 billion to AED20.10 billion, which has been the main reason for the decline during 2020 of net profit.

The total assets during the year grew 11.81 per cent, from AED821.97 billion to AED919.06 billion. However, the FAB’s asset base witnessed a contraction of 3.77 per cent during the three-month period since September end, from AED955.15 billion as the economy suffered the onslaught from the unrelenting COVID 19.

The profitability during the year has been affected by the slowdown in the economy leading to larger impairment charges to the tune of AED2.62 billion compared with AED1.84 billion last year – an increase of 42.39 per cent.

FAB said its underlying operating performance is expected to improve in 2021, driven by a healthy pipeline of business from government and state-linked companies, and by its latest acquisition in Egypt.

FAB earlier this month said it had agreed to buy the Egyptian business of Lebanon’s Bank Audi in a deal, which will make the bank one of the biggest foreign banks in Egypt.

 

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