DUBAI (Bloomberg) -- Emirates NBD PJSC, the biggest bank in the Persian Gulf region, said full-year profit rose 35 percent as economic growth boosted loan demand in the United Arab Emirates.

Net income, excluding amortization of intangibles, climbed to 4.03 billion dirhams ($1.1 billion), or 1.22 dirhams a share, the Dubai-based bank said Wednesday in a statement without providing year- earlier figures. Revenue climbed 50 percent to 7.11 billion dirhams. The bank's board proposed a cash dividend of 35 fils a share and 15 free shares for every 100 held.
The UAE economy looks “robust” with GDP expected to rise 7 percent in 2008 so the bank is “cautiously optimistic” about growth, Rick Pudner, Emirates NBD’s chief executive officer, said on a conference call. The interest rate environment is more “uncertain” than in 2007, he added.
Dubai’s government created Emirates NBD by merging Emirates Bank International PJSC and National Bank of Dubai PJSC in October to help it compete with larger foreign rivals like HSBC Holdings Plc. The bank has assets of 253.8 billion dirhams and will focus on expanding, including in Saudi Arabia and Singapore, as well as consider “opportunistic” acquisitions, Pudner said.
Emirates NBD’s loan book grew 48 percent in the year to 152 billion dirhams for a 21 percent share of the UAE loan market, the bank said. Deposits increased 44 percent to 124.1 billion dirhams while costs rose 51 percent to 2.7 billion dirhams.
-----------------------------Emirates bank
Net income at Emirates Bank jumped 27 percent to 2.39 billion dirhams while earnings at National Bank of Dubai climbed 44 percent to 1.6 billion dirhams, the bank said.
“These look like strong results, about 10 percent higher than what we expected,” Raj Madha, an analyst at brokerage EFG-Hermes Holding SAE, said in a telephone interview from Dubai. “The main drivers are net interest income and fee and commission income.”
Emirates NBD shares rose 10 fils, or 0.7 percent, to 15 dirhams at 1:01 p.m. on the Dubai Financial Market. The stock has risen 3.1 percent this year.
In January, National Bank of Abu Dhabi PJSC, UAE’s second- biggest bank, reported a 19 percent rise in 2007 profit to 2.5 billion dirhams while Abu Dhabi Commercial Bank PJSC, the third- largest, said earnings fell 3 percent to 2.09 billion dirhams.
Emirates NBD has some “indirect exposure” to the U.S. sub-prime market, estimated at $10 million to $15 million, and has made a provision in anticipation of losses from these securities, Emirates NBD Chief Financial Officer Sanjay Uppal also said Wednesday.
Emirates NBD expects to fully integrate operations of the two banks by July 2009, Pudner said Wednesday.