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Emirates NBD’s profit jumps, says ready for higher rates

Emirates NBD’s annual profit rose 34 percent as an improving economy boosted investment banking income, Dubai’s biggest lender said on Wednesday, while impairments fell sharply from the height of the pandemic.

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The lender also boosted its dividend by 25 percent to 0.50 dirhams per share and said it was in a good shape to navigate rising interest rates amid a better mix of funding options.

“The funding mix improved as we added a further 38 billion dirhams ($10.35 billion) of current accounts and saving account balances during 2021 and we are well positioned to benefit from a potential rise in interest rates,” Group CEO Shayne Nelson said in a statement.

Banks in the United Arab Emirates are benefiting from an uptick in economic activity as the effects of the pandemic ease amid government support, higher oil prices and strong tourism due to the world fair Expo in Dubai.

Analysts expect 2022 will be even better for banks as domestic interest rates should rise, tracking higher US rates, and loan growth should also improve.

“Rates environment is favorable for the banks,” said Shabbir Malik, an analyst at EFG Hermes. “Loan growth should be better than last year.”

Emirates NBD posted a net profit of 9.3 billion dirhams ($2.53 billion) for 2021, up from 7 billion dirhams a year earlier. Analysts on average had expected a net profit of about 9 billion dirhams, according to Refinitiv’s Eikon data.

Separately, Dubai Islamic Bank reported a 39 percent jump in full-year earnings to 4.4 billion dirhams and a significant decline in impairment charges.

Emirates NBD said impairment allowances were down 26 percent in 2021 from a year earlier, with cost of risk within the pre-pandemic range.

For the fourth-quarter, net profit jumped more than 50 percent to 2 billion dirhams from a year earlier. EFG Hermes had forecast 2.3 billion dirhams and Arqaam Securities 1.6 billion dirhams.

Emirates NBD’s net interest income rose 7 percent to 4.3 billion dirhams in the quarter, while non-funded income – earnings from areas such as investment banking and foreign currency trading – jumped 146 percent.

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Iran and Oman agree on panel to jointly develop shared oilfield: Fars news

Iran and Oman have agreed to form a committee to jointly develop the Hengam oilfield, which straddles both countries’ sea border, Iran’s semi-official Fars news agency reported its oil minister Javad Owji as saying on Monday.
In 2005, both countries signed a memorandum of understanding to jointly develop the Hengam oil field but the agreement did not materialize and Iran decided to develop the field independently in 2012.

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“As the first basis of my talks with Omani Oil Minister Mohammed bin Hamad Al-Rumhi, it was agreed to form a joint technical committee to develop the next phases of the Hengam oil field in a seamless manner between Iran and Oman,” Owji said.
“Joint exploitation, in contrast to competitive exploitation, will be mutually beneficial to both countries as this method leads to less damage to the reservoir and allows for more extraction,” the oil minister added.
Last week, Iran’s state news agency IRNA reported that Owji had agreed to revive a long-stalled project to lay an undersea pipeline to carry gas to Oman.

Read more: Iran to revive gas pipeline project to Oman: IRNA

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Abu Dhabi-based petrochemicals firm Borouge’s IPO book covered: Bookrunners

Books for the initial public offering of Abu Dhabi-headquartered petrochemicals firm Borouge were covered in about an hour after opening, a bookrunner on the deal said.
Borouge is a joint venture between Abu Dhabi National Oil Company (ADNOC) and Austria’s Borealis.
ADNOC declined to comment.

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Read more: ADNOC and Borealis to float 10 pct stake of joint venture polymer giant Borouge

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SAGO has bought 89,290 tons of wheat from Saudi farmers

Saudi Arabia’s state grains buyer (SAGO) procured 89,290 ton of wheat from local farmers so far, it said in a statement on Monday.

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