First Abu Dhabi Bank Case Study: Financial Performance Analysis

This case study examines the First Abu Dhabi Bank (FAB), analyzing its background, operational structure, and strategic issues. It delves into the external environment, utilizing Porter's Five Forces to assess the competitive landscape. The study highlights the bank's financial performance through key indicators and provides a SWOT analysis to identify strengths, weaknesses, opportunities, and threats. Recommendations are provided to enhance growth, including establishing a monitoring body, focusing on sustainable business practices, expanding internationally, and strengthening customer relationships. References to relevant academic papers are also included to support the analysis, providing a comprehensive overview of FAB's financial standing and strategic direction within the UAE banking sector.

Case Analysis
First Abu Dhabi Bank

Company Background
• First Abu Dhabi bank is an United Arab Emirates based banking
organization
• It has been formed with a merger of National Bank of Abu Dhabi
and the First Gulf Bank.
• The partnership is based on equal participation in the board
position from both the partnering Banks.
• As the merger has been between two highly successful banking
institutions, the current operational structure is sufficient in
managing the growing industry requirements.

Introduction
• Mission
• Business
• Markets
• Products
• Scope of operations

Industry profile and
attractiveness
• Domestic Banking
• International banking
• Financial markets segments
• E-commerce group based operations

Strategic Issue
• Incorporating environmental
sustainability
• Assessing social sustainability
across the organization
• Decreased employee productivity

External Environment
• Efficiently established operational environment helps in
managing the progress for the banking operations.
• The banking sector across Abu Dhabi is competitive and
thus regulated development is a key factor.
• The economy is growing and thus there are suitable
expansion opportunities across this sector.

Porter’s 5 Forces Analysis
• Bargaining power of suppliers
• Threat of new entrants
• Bargaining power of buyers
• Threat of substitution
• Rivalry among existing competitors

Company Situation
• The organization has been developing since its founding
and thus the available scenarios can be considered as
productive.
• Being one of the largest operational banking body across
the region, this organization has been evident in
promoting its branding across the industry positively (Al-
Qudah, 2017).
• It has a huge range of customers from medium to large
operating values and this describes a healthy financial
situation of the company.

Financial analysis
• Constant increment in the per share earning of the bank
suggests its efficient financial position.
• Huge customer base promotes availability of consistency
in business
• Increased dividends and valuation ratios suggest positive
financial position
• The growth rate for this bank () has been increasing with
the total industry’s growth rate

SWOT Analysis
Strengths
• Strong customer base
• Increased financial balance across the institution
• Availability of digital banking initiatives
Weaknesses
• High competitive factors
• Lack of promotional offers and events
Opportunities
• Increased economy across the country
• Supportive government forces
• Increased investment requirements across the small and medium enterprises
Threats
• Increased liquidity conditions across different companies
• Decreased oil based economic growth

Recommendations
• Establishment of a functional monitoring body for
idealizing its growth and limitations
• Depending on sustainable business obligations to ensure
better social and environmental outcomes
• Facilitating better expansion opportunities outside the
country
• Development of a strong customer hold for enhanced
performance experiences.

References:
• Banerjee, R., & Majumdar, S. (2017, July). Does Financial Regulation Influence Bank Efficiency? A
Study on UAE Banking Sector. In International Conference on Applied Economics (pp. 679-691).
Springer, Cham.
• Al-Qudah, A. A. (2017). The Factors that Affecting on the Consumers' Continuing to Use Internet
Services in the Banking Industry: Empirical Evidence from Abu Dhabi, UAE. Modern Applied
Science, 11(4).
• Al-Tamimi, H. A. H., Lafi, A. S., & Uddin, M. H. (2016). Bank image in the UAE: Comparing Islamic
and conventional banks. In Islamic Finance (pp. 46-65). Palgrave Macmillan, Cham.
• Jan, A., & Marimuthu, M. (2015). Altman model and bankruptcy profile of islamic banking industry:
A comparative analysis on financial performance. International Journal of Business and
Management, 10(7), 110-119.
• Banerjee, A., & Rafiuddin, A. (2015). An Essay on Returns to Scale of Banks in UAE. Asian journal
of management sciences & education, 4(1), 43-50.