Abu Dhabi Islamic Bank’s SME financing totalled Dhs1b in 2022

Abu Dhabi Islamic Bank (ADIB), a leading Islamic financial institution, has announced the release of its second Environmental, Social, and Governance (ESG) report emphasising the progress made on the bank’s EGS goals and commitments for the year 2022.

The report also highlights a new three-year ESG strategy to integrate ESG risks considerations into the banking framework and support the UAE’s efforts to achieve the transition towards a more sustainable economy.

The 2022 ESG report provides a comprehensive evaluation of the progress ADIB made in various environmental, social, and governance related metrics, highlighting significant improvements made over the past year.

Abu Dhabi Islamic Bank invested Dhs23 million in community development initiatives, and provided Dhs1 billion in SME financing in 2022.

Around 60 per cent of the bank’s funding portfolio was low or medium risk according to ESG standards, maintaining a stable and secure financial position.

Additionally, the bank maintained one of the highest Emiratisation ratios, reaching 45 per cent. This was coupled with steady progress in strengthening women’s representation in executive roles, where women now represent 39.4 per cent of ADIB’s entire workforce.

To further assist UAE nationals and provide young people with greater access to essential financial services, ADIB continued to focus on the younger generation through its Amwali product, making ADIB the first Islamic digital bank targeting youth from 8 to 18 years old, resulting in around 13,500 new youth accounts being opened in 2022.

Nasser Al Awadhi, Group Chief Executive Officer at ADIB, said, “We are proud to present our second edition of the ESG report, outlining our three-year ESG strategy integrated into the banking framework, and supporting the UAE’s transition towards a more sustainable economy.”

This report reflects our commitment to enhancing our social and environmental impact and ensuring continued success as a responsible and ethical financial institution.”

The new three-year ESG strategy prioritises accelerating ADIB’s Green Financing and Investing initiatives.

The bank has already made significant strides in this area, having allocated $1.7 billion towards sustainable project financing under green financing.

Additionally, ADIB has obtained six LEED green building certificates and saved an impressive five million papers through its Al Ghaf paperless programme in 2022.

The bank has made significant progress in reducing its carbon footprint, reporting a 26 per cent reduction in energy consumption intensity last year.

Meanwhile Abu Dhabi Islamic Bank (ADIB) has announced in March that its General Assembly has approved a cash dividend of Dhs1.7 billion, 49 fils per share for the fiscal year ending Dec.31st, 2022.

This represents an increase from 31 fils per share in 2021 and constitutes 49.2 per cent of the bank’s net profit for the year. In addition, ADIB delivered a Return on Equity (ROE) of 21.4 per cent, one of the highest rates in the sector, reflecting the bank’s solid momentum across its core businesses and an improved macroeconomic environment.

During the meeting, the ADIB General Assembly also approved the Board of Directors’ report, the auditors’ report, and the financial statements for the year 2022.

Commenting on the bank’s performance, Jawaan Awaidha Suhail Al Khaili, ADIB’s Chairman, said, “We would like to extend our sincere appreciation to our shareholders for their continued support and trust in our vision. We are also proud of our firm commitment to the ESG agenda within our strategic business plan for the next five years, coinciding with the UAE declaring the Year of Sustainability, as we see a real integration of sustainability at all levels in our business. We look forward to working with entities and institutions in the UAE and our counterparts to develop innovative solutions that will support economic and sustainable development, and to advance our shared vision of a more prosperous and resilient future.”

Nasser Al Awadhi, ADIB’s Group Chief Executive Officer, added, “Throughout the year, ADIB has made significant progress towards realising its vision, as demonstrated by our strong financial performance and ongoing focus on transformation to build a resilient bank. Our commitment to sustainable banking practices and digital transformation, combined with the hard work and dedication of our team members, has driven our strong financial performance.”

ADIB has witnessed steady growth in 2022 across all its businesses. The bank’s market share continued to grow, and customer finance and funded income both increased by 22 per cent and 24 per cent, respectively. ADIB also delivered a solid fee income growth of 43 per cent, reflecting its focus on delivering specialised offerings and innovative solutions. The e bank’s franchise was further enhanced by new growth platforms, including increased ownership in ADIB Egypt.