Emirates NBD expects 12-15% growth in retail business in 2015

Dubai’s largest lender Emirates NBD has forecast 12 to 15 per cent growth in its retail business this year, the bank’s retail banking head said.

Speaking to reporters on the sidelines of a press conference, Suvo Sarkar said that the bank had been able to meet its previous targets set for achieving growth in retail banking.

Most UAE banks saw strong growth in their lending businesses last year as the economy continued to rebound.

But the current oil price volatility is unlikely to lead to another stellar year for banks in the UAE and the wider GCC.

Sarkar downplayed the tough economic climate, saying that it may not impact the bank’s growth estimates.

“It hasn’t yet affected and we are hoping, cautiously optimistic, that it won’t affect us. There is likely to be an impact on certain sectors if the oil price fall continues – for example in SME lending. But for now it won’t be an issue.

“In fact our payment volumes are growing 20 per cent year-on-year, whether its credit or debit cards we see spending going up 20 per cent.”

Sarkar also remained bullish on the bank’s retail growth estimate despite less mortgage demand.

“Mortgages have gone down because there are less transactions and there is a slight slowdown in the market but we are still growing.

“We have other sectors that are aiding the growth … wealth management, credit and debit cards, SME lending are all growing healthily.”

Earlier this year, the Dubai lender’s CEO Shayne Nelson said that he expected government spending to insulate UAE banks from the negative effects of oil price volatility.

Following this, Emirates NBD posted a 60 per cent rise in first-quarter net profit in 2015, as income from lending, fees and other products increased and provisions dropped.

The lender, partly owned by state fund Investment Corporation of Dubai, made a net profit of Dhs1.67 billion ($454.67 million) in Q1 2015. This was up from Dhs1.04 billion in the same period of 2014.