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UPDATE 1-First Gulf Bank Q3 up 9 pct on core activities

Published 10/21/2009, 09:06 AM
Updated 10/21/2009, 09:09 AM
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* Q3 net profit $253.2 million vs $231.4 yr-ago

* Says exposure to troubled Saudi groups Saad-Gosaibi $104 million (Adds details, quotes)

By Stanley Carvalho

ABU DHABI, Oct 21 (Reuters) - First Gulf Bank on Wednesday posted a net profit of 930 million UAE dirhams ($253.2 million) in the third quarter, up 9 percent on the year, driven by its core businesses and beating analyst forecasts.

The bank reported a net profit of 850.12 million dirhams in the same quarter last year. Analysts polled by Reuters forecast an average net profit of 762.93 million dirhams.

"Our core banking businesses remain the engine driving our growth and are behind our strong financial results," CEO Andre Sayegh said in a statement.

The bank earned 58 percent of its revenues from interest and Islamic finance, 18 percent from corporate and retail fees and commissions, 11 percent from foreign exchange derivatives and investment income and 13 percent from subsidiaries and associate companies.

Net profit for the nine-month period this year was 2.456 billion dirhams, up 5 percent over the same period last year.

"So far the numbers declared by UAE banks exceed well above market expectations, thus indicating that the banking system proved to be far more resilient than what the market thought initially," said an Abu Dhabi-based banking analyst.

"FGB's headline numbers show it is maintaining its fast growth with a strong loan book," the analyst, who did not want to be identified, said.

Loans and advances grew 4.6 percent to 90 billion dirhams in the third quarter while deposits grew 6.7 percent to 89.4 billion dirhams. Total assets stood at 124 billion dirhams ending September 2009, up 16 percent over that of December 2008.

FGB said its exposure to troubled Saudi groups Saad-Gosaibi is $104 million (382 million dirhams), its first disclosure. Out of this, $55 million is on syndications and $49 million on trade business.

The bank has booked 490 million dirhams in loan provisions in the third quarter and plans to book additional provisions of 174 million dirhams over the coming five quarters ending in 2010. FGB took provisions of 220 million dirhams in the first quarter and 260 million dirhams in second quarter.

FGB shares on Wednesday closed 0.8 percent lower at 18.4 dirhams. (Reporting by Stanley Carvalho, editing by Natsuko Waki and Rupert Winchester)

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