First Abu Dhabi Bank Q3 2025 slides: Record profit growth of 24% as revenue diversifies

Introduction & Market Context

First Abu Dhabi Bank (FAB) presented its Q3/9M 2025 earnings results on October 22, 2025, showcasing record-breaking performance across key financial metrics. The UAE's largest bank reported a 24% year-over-year increase in net profit, reaching AED 16.02 billion for the first nine months of 2025, while maintaining its AA- credit rating.

Despite the strong performance, FAB's stock price dipped slightly following the announcement, with shares closing at AED 13.52 on October 20, 2025, representing a 0.61% decrease. However, the bank has demonstrated resilience over a longer timeframe, with a reported 16.72% gain over the past six months.

Quarterly Performance Highlights

FAB's Q3 2025 results demonstrated robust growth across key metrics, with the bank exceeding all its financial guidance targets for the fiscal year. Group revenue reached AED 27.65 billion for the first nine months, representing a 16% increase year-over-year, driven by both traditional banking operations and a strategic shift toward fee-based income.

As shown in the following comprehensive income statement summary, the bank's profit before tax increased by 26% year-over-year to AED 19.25 billion, while operating expenses were well-managed with only a 4% increase:

The quarterly results were equally impressive, with Q3 2025 profit before tax up 21% year-over-year to AED 6.42 billion. The bank's basic earnings per share for Q3 reached 0.46, also representing a 21% increase from the same period last year:

Detailed Financial Analysis

A notable trend in FAB's performance is the growing contribution of non-interest income, which increased by 37% year-over-year to AED 12.7 billion, while net interest income showed a more modest growth of 2% to reach AED 15 billion. This shift toward non-funded income has been strategic, with non-interest income now representing 46% of total operating income in Q3 2025, up from 32% in Q1 2022.

The following chart illustrates this sustained growth in non-interest income, which has become an increasingly important driver of the bank's overall performance:

While net interest income growth has been more moderate, FAB has maintained resilient net interest margins (NIM) despite a challenging interest rate environment. The bank's NIM was 1.84% for the first nine months of 2025, 9 basis points lower year-over-year, with Q3 2025 NIM at 1.76%:

Cost management has been a particular strength for FAB, with the cost-to-income ratio improving to 22.0% from 24.3% in the same period last year. The bank has maintained disciplined expense control while continuing to invest in strategic initiatives:

Strategic Initiatives & International Expansion

FAB's presentation highlighted its expanding global footprint, with operations now spanning more than 20 markets following new expansions in Europe, Turkey, Nigeria, and India. This international growth strategy is reflected in the bank's revenue composition, with 17% of revenues now generated outside the UAE.

The following breakdown shows the diversification of revenue across the bank's main business divisions and geographical regions:

The bank has also made significant progress in digital transformation, reporting the deployment of 18 live AI agents that have doubled processing capacity and reduced turnaround times by up to 50%. These technological advancements support FAB's ability to scale operations efficiently while maintaining cost discipline.

Asset quality has remained strong, with the non-performing loans (NPL) ratio at an all-time low and provision coverage exceeding guidance:

Forward-Looking Statements

FAB's presentation provided a clear comparison between its fiscal year 2025 guidance and actual performance for the first nine months, showing that the bank is well on track or exceeding all key targets:

The bank's macroeconomic outlook remains positive, with UAE real GDP growth projected at approximately 5.2% for FY 2025 and 5.6% for FY 2026. However, FAB is anticipating interest rate cuts, with two additional cuts expected in Q4 2025 and two to three more in FY 2026, which could put pressure on interest margins.

Management expressed confidence in sustaining performance and returns, highlighting the bank's robust balance sheet fundamentals and strong capital position as key enablers for continued growth. The CET1 ratio stood at a healthy 13.7%, exceeding the guidance of >13.5%:

In conclusion, FAB's Q3/9M 2025 results demonstrate the bank's ability to generate strong, diversified growth while maintaining disciplined cost management and solid asset quality. With all financial guidance metrics on track or exceeded, and a clear strategy for international expansion and digital transformation, FAB appears well-positioned to navigate the anticipated changes in the interest rate environment and sustain its growth trajectory.

Full presentation:

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