January 30, 2018 / 6:33 AM / a year ago

UPDATE 1-First Abu Dhabi Bank's Q4 profit crimped by merger costs

(Adds Q4 net profit figures)

DUBAI, Jan 30 (Reuters) - First Abu Dhabi Bank (FAB), the largest bank in the United Arab Emirates, posted a 1 percent fall in fourth quarter net profit, citing costs linked to its recent merger.

FAB, the combination of National Bank of Abu Dhabi and First Gulf Bank, said net profit for the quarter was 2.82 billion dirhams ($768 million), compared with 2.85 billion dirhams in the year earlier.

SICO Bahrain had estimated the bank would make a net profit of 2.65 billion dirhams, while EFG Hermes forecast 2.83 billion dirhams.

Excluding integration costs and other merger-related expenses, adjusted net profit for the quarter was 3.16 billion dirhams, up from 2.97 billion dirhams a year ago.

FAB’s board of directors recommended a cash dividend of 0.70 dirhams per share, which it said was the highest combined dividend distributed by the two banks, up 11 percent from 2016.

It said it had achieved around 500 million dirhams of cost synergies in the first year of integration, adding that it was evaluating its local activities and branch network.

“Regionally, we are working on expanding our presence to Saudi Arabia which forms part of FAB’s long-term strategy,” group chief executive Abdulhamid Saeed said.

Regional and international banks are eyeing opportunities to expand in Saudi Arabia, the largest economy in the Gulf, as the government pushes through reforms to cut the country’s dependence on oil revenue. ($1 = 3.6724 UAE dirham) ($1 = 3.6718 UAE dirham) (Reporting by Tom Arnold and Stanley Carvalho; Editing by Alexander Smith and Vyas Mohan)

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