Credit Quality and Financial Performance
Net Interest Income
Highlights
NIM of 2.52% in 2010; declined by 29 bps from 2.81% in 2009:
о
○
Negative mix impact of deployment of increased liquidity in lower yielding
interbank and cash-equivalent assets
Increase in deposit funding costs given strong competition for deposits in
the UAE
O
Partly offset by continued selective re-pricing of loans
■
Margin decline evident during 2010 arrested in Q1 2011 with NIM stable at
2.41% vs. Q4 2010:
2.21
Net Interest Margin Trends (%)
3.01
Qtrly NIM
2.85
2.76
2.65
2.60
2.59
2.54 2.51
2.41 2.41
O Increase in deposit spreads due to active downward re-pricing of deposits
о
Offset by continued negative mix impact of increased liquidity
Growth in assets driving 2% growth in net interest income from Q4 2010 to
USD 44 million in Q1 2011
Net Interest Margin Drivers: 2010 (%)
2.05
2.01
Q108 Q2 08 Q3 08 Q4 08 Q1 09 Q2 09 Q3 09 Q4 09 Q1 10 Q2 10 Q3 10 Q4 10 Q1 11
Net Interest Margin Drivers: Q1 2011 (%)
0.09%
(0.12%)
2.81%
0.07%
(0.23%)
0.02%
(0.10%)
0.01%
0.04%
2.41%
2.41%
2.52%
2009
Asset
Spreads
Deposit Treasury
Spreads Spreads
Other
2010
Q4 2010
Asset
Spreads
Deposit Treasury
Spreads Spreads
Other
Q1 2011
Emirates NBD
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