Dubai’s Emirates NBD Shares Fall As Tax, Lower Recoveries Hit Half-Year Profit

Emirates NBD's shares slipped on Thursday after Dubai's biggest bank by assets reported a 9% fall in first-half net profit, as lower recoveries and a higher tax rate impacted the lender's results.

The bank posted a net profit of 12.5 billion dirhams ($3.40 billion) in the six months to June 30, down from 13.8 billion over the same period in 2024. 

Shares in the bank were down 1.9% at 0615 GMT.

The stock remains up 21% since the start of the year.

ENBD, majority-owned by Dubai's government, said recoveries in the first half of 2025 were down by 2 billion dirhams, which compared with "very strong recoveries" last year, the bank said in a statement.

UAE banks have been benefitting from steady economic growth, rising demand for credit and government-driven investment in non-oil sectors in recent years.

In Dubai, the Gulf's tourism and financial hub, a business-friendly environment has attracted a slew of companies and high-net-worth clients, contributing to a spike in real estate prices.

However, ENBD said on Thursday that while in the first half, "property transactions in Dubai were higher compared with 2024", price growth "is moderating."

Ratings agency Fitch expects a correction in real estate prices in the second half and in 2026, as new builds come to the market, it said in May.

ENBD's total assets reached 1.09 trillion dirhams as of end-June, up 17% from a year earlier, with both net interest income and non-funded income rising by double digits.

The bank's total gross loans rose 12% to 570 billion dirhams in the first six months, with nearly half of the increase coming from international operations.

They were outpaced by deposits, which grew 18% to 737 billion dirhams.

Its net interest margin dropped to 3.47% at the end of June, its lowest since 2022, impacted in the second quarter by a rate hike in Turkey, where ENBD operates through its unit DenizBank.

($1 = 3.6721 UAE dirham)