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business
Tuesday Jul 21 2020
By
AFP

Dubai bank witnesses plunge in second-quarter profits over bid to counter coronavirus fallout

By
AFP
Its net profit in the six months ending June 2020 also slumped by 45.3% to $1.1 billion from $2.0 billion the same period last year. — Reuters/Files

DUBAI: Dubai's largest bank Emirates NBD said Monday its net profits plunged in the second quarter as it made huge provisions to counter the potential impact of the coronavirus crisis.

The United Arab Emirates (UAE) lender saw its net profit in the second quarter this year dive 58% to $545 million from $1.3 billion a year ago. Its net profit in the six months ending June 2020 also slumped 45.3% to $1.1 billion from $2 billion the same period last year, it said in a statement.

The bank said it has set aside $1.14 billion in impairments for potential risks from the coronavirus pandemic.

"The Group increased impairment allowances... in anticipation of a potential deterioration in credit quality in subsequent quarters related to the coronavirus pandemic," it said.

CEO Shayne Nelson said the bank provided support to a tenth of its customers primarily through the deferral of over $2.2 billion of interest and principal for periods of up to six months.

The UAE's central bank had said on April 5 it had doubled to $70 billion a stimulus package aimed at supporting the economy and domestic banks in the face of the novel coronavirus pandemic.

The bank's total assets by the end of June rose 29% to $189.2 billion from $146.5 billion a year ago, mainly due to the purchase of Turkish lender DenizBank.