UAE Banks: Remain below consensus; FAB preferred

Research evidence excerpt

UAE Banks: Remain below consensus; FAB preferred

United Arab Emirates | Banks EquityMayResearch11, 2026

KEY STOCKS FEATURED INCLUDE:UAE Banks: Remain below consensus; FAB

TICKER RATING PRICE TARGETpreferred

ADCB UH BUY AED16.50

FAB (Buy) remains our preferred UAE stock. Post Q1'26 results, we are ADIB UH HOLD AED24.50

marginally upbeat on sector credit growth but retain caution on asset quality EMIRATES UHHOLD AED33.50

amid guarded mgmt tone and emergent macro. We make minor EPS / PT FAB UH BUY AED23.50

changes post results (most in ADIB -2% EPS, -6% PT vs. prev) and remain 6-7%

below VA consensus 26-27E pre-tax across the sector, mainly due to higher

cost of risk as framed in our recent sector update.

KEY CHANGES INCLUDE:

UAE banks highlighted consistent messages of: a) healthy core revs momentum with domestic TICKER RATING PRICE TARGET

activity normalizing in April; Q4'25 rate cuts weighed on yields, but renewed rates hawkishness is ADIB UH HOLD AED24.50 (AED26.00)

NII supportive; Q2 NIM could be pressured (FAB led on NII, ENBD on fees); b) liquidity dislocation EMIRATES

short-lived (sector deposits 5%qoq / 13%yoy; ENBD led; ENBD and FAB saw deposit mix shift HOLD AED33.50 (AED33.00) UH

to time); c) growth opportunities visible despite elevated geopolitical risk (7%qoq / 25%yoy loan

FAB UH BUY AED23.50 (AED24.00)

growth; FAB led); public sector / GREs key 26-27E drivers, although retail demand could soften,

and d) credit quality intact (limited uptake of deferrals); mgmt prudence expressed via scenario re-

weighting (stress testing in ADIB) until the extent of pressures is more visible (this explained bulk of

Q1 impairments in ENBD and ADCB; FAB highest qtrly COR). FY26 guidance unchanged, although Exhibit 1 - Key changes to UAE banks'

estimates post Q1'26