Emirates NBD Bank (EMIRATESNBD) Q4 2023 earnings summary

Executive summary

• FY 2023 net profit reached a record AED 21.5bn, up 65% YoY, supported by income growth, stronger recoveries and diversified performance.

• Total income hit AED 43.0bn, up 32%; deposits grew AED 82bn, including AED 30bn in CASA balances, and the proposed dividend doubled to 120 fils per share.

Financial highlights

• Net interest income rose 30% to AED 30.1bn and non-funded income rose 39% to AED 12.9bn; total income increased 32% to AED 43.0bn.

• Operating expenses increased 26% to AED 11.7bn; operating profit before impairment rose 35% to AED 31.3bn, while impairment allowances fell 33% to AED 3.4bn.

• Profit before tax and other items rose 54% to AED 27.9bn; FY net profit was AED 21.5bn versus AED 13.0bn, and Q4 profit was AED 4bn, up 3% YoY.

• Total assets grew 16% to AED 863bn; gross loans rose 5% to AED 481bn and deposits increased 16% to AED 585bn.

Outlook and guidance

• 2024 NIM guidance remains 3.8–4.0%; potential DenizBank NIM upside may be offset by deposit-mix effects and market uncertainty.

• 2024 cost-to-income guidance is at or below 33%; NPL ratio guidance is 4–5% and cost-of-risk guidance is 50–70bp.

• 2024 net loan growth guidance is mid-single digit.

• Research forecasts 2024 non-oil growth of 4.5% in the UAE and 4% in Saudi Arabia, supported by investment and consumption.

• Saudi branch network expansion is planned from 15 branches to 24 by 2025.