Financial Performance of Abu Dhabi Commercial Bank in UAE Case Study

Financial Performance of Abu Dhabi Commercial Bank in UAE - Case Study Example Abu Dhabi Commercial Bank acquired RBS’ UAE retail, wealth management and SME banking business. Abu Dhabi Commercial Bank is currently the third largest bank in the UAE in terms of operations and second largest in the Emirates of Abu Dhabi in terms of total assets. The bank has a substantial customer base and holds around 12% market share by loans and 10% market share by deposits. The bank currently has approximately 500,000 retail customers and 33,000 wholesale customers in the UAE. Abu Dhabi Commercial Bank has divided its operations into four main domains as follows. Abu Dhabi, the second largest city of UAE, is one of the emerging economies of the world. During the financial year 2009, amid the global economic crisis, the growth trend of Abu Dhabi took a downward plunge when the real GDP growth remained only 0.2% and its GDP per capita was 90,538 USD, which was still considered among the highest at the global level. With the implementation of prudent policies, the government of UAE has now able to restore its previous economic prosperity and it is portraying inclining trend once again. The banking sector in UAE can be regarded as the biggest beneficiary of the economic growth. This is due to the fact that the prevailing interest rate in the UAE economy is lower as compared to the other countries depicting similar economic trends. Central Bank of UAE is the regulatory authority which issues guidelines and pronouncement regulating the functioning of these banks. As of March 31, 2011, UAE economy had 23 local banks with 736 branches and 28 licensed foreign banks with 83 branches. The following graphical representation presents the growth in the banking sector in UAE over the years [presentation] Technical Analysis The share price of Abu Dhabi Commercial Bank remained fluctuated over the past few years. If we consider the financial year 2006, the share price of the bank depicts a rising trend. In the beginning of the financial year 2006, the share price of the bank was crossing 5.66, but by the end of the financial year 2006, the share price took a downward plunge and the December closing of the financial year recorded a share price of 4.16. Despite the declining trend in the previous year, Abu Dhabi Commercial Bank was able to restore its previous market capitalization and by the end of the financial year 2007, the share price represents an increase of 19%. Financial year 2008 and 2009 are