This feature was first published in the June 2026 issue of Business Today Middle East.
Commercial Bank of Dubai posted a net profit of AED 830 million in Q1 2026, a result that would be notable in any environment, let alone one shaped by regional conflict, rising provisioning costs, and a geopolitical backdrop that rattled markets across the Gulf. For CFO Darren Clarke, the numbers are not a lucky outcome but the product of deliberate choices: building buffers during periods of strength, investing in technology while keeping costs tighter than almost any peer in the industry, and crossing AED 100 billion in net loans without compromising on asset quality. We sat down with Clarke to understand how CBD is navigating uncertainty, and what it is building for next.
“Discipline in this context means continuing to lend, continuing to invest, and continuing to provision conservatively, all at the same time.”
CBD has delivered a net profit of AED 830 million in Q1 2026 while navigating heightened regional uncertainty. As CFO, how do you maintain that level of financial discipline and consistency when the external environment is anything but predictable?
A diversified loan book, a stable deposit franchise with CASA at 51% of total deposits, and capital ratios well above regulatory minimums. When those foundations are in place, the business can absorb volatility without changing course.
In Q1 2026, we grew operating income 6.2% to AED 1.456 billion and operating profit 6.4% to AED 1.065 billion. At the same time, we chose to increase provisioning, raising our IFRS 9 downside scenario weight from 30% to 40% in response to the regional conflict. Net impairment charges rose 68% to AED 152 million. That was a deliberate decision to build buffers during a period of strength.
Discipline in this context means continuing to lend, continuing to invest, and continuing to provision conservatively, all at the same time. The quarterly result is the output of that approach.
Crossing AED 100 billion in net loans is a landmark milestone for any bank. What does that number represent beyond the balance sheet, and what does it tell us about the confidence that businesses and individuals in the UAE are placing in CBD right now?
Crossing AED 100 billion is a milestone, but the more relevant point is that we are growing responsibly and backing our customers through a complex environment. Lending activity was robust in the first two months of the year, moderating in March as the market adjusted to geopolitical developments. But the pipeline remains healthy.
Net loans at AED 102.1 billion represent real economic activity. Behind that number are corporations expanding, SMEs investing in their operations, and individuals buying homes and building their futures. Gross loans grew 4.1% year-on-year to AED 106.4 billion, with origination strong across institutional, corporate and personal banking segments.
What it reflects about confidence is important. Customer deposits grew 10% year-on-year to AED 109.6 billion. Clients are choosing CBD both to borrow and to place their money. The loan-to-deposit ratio at 93.1% shows that growth is funded sustainably, not through wholesale reliance.
CBD’s cost-to-income ratio of 26.90% positions it among the best in the industry, and yet you are simultaneously investing heavily in digitisation, technology, and talent. How do you strike that balance between disciplined cost management and the investment needed to stay ahead?
By ensuring revenue grows faster than costs. Operating income was up 6.2% while operating expenses rose 5.8%. That positive gap is what allows us to invest and maintain efficiency at the same time.
Within the expense base, we are selective. Staff costs increased to AED 201 million, reflecting targeted hiring in technology, compliance and business-facing roles. General and administrative expenses were virtually flat at AED 158 million. Depreciation rose 65% to AED 32 million as capitalised technology investments came online. So the increase is concentrated in areas that drive future capability, not in overhead.
We do not manage a specific cost-to-income target in isolation. We manage for a return on investment. If a dirham spent on technology generates a multiple in income or saves cost downstream, we will deploy it. At 26.90%, the ratio speaks for itself. The priority is sustaining that discipline while continuing to build for the future.
CBD was the first bank in the UAE to fully activate Open Finance at scale. That is a bold move that carries both opportunity and risk. What was the strategic thinking behind that decision, and what do you believe it will unlock for the bank and its customers over the next few years?
The thinking was straightforward. Open Finance is the direction the industry is heading, and being early gives us a structural advantage. CBD activated Open Finance at scale because we believe that giving customers control over their financial data, and enabling them to share it securely across providers, deepens trust and strengthens relationships. It does not weaken them.
From a business perspective, Open Finance creates new revenue pathways. It allows us to offer more personalised products, improve credit decisioning through richer data, and embed CBD’s services into broader digital ecosystems. It also positions us as a preferred partner for fintechs and third-party providers who need a bank with open, modern infrastructure.
The recognition by Global Brands Magazine for Excellence in Digital Banking Transformation validates the approach. But the real measure will be in customer adoption, product innovation and the commercial returns that follow over the next two to three years. We are confident in the direction.
“We do not set a fixed technology budget and leave it untouched for the year. We reassess continuously based on what is delivering results and where the market is moving.”
The UAE’s financial sector is undergoing a profound transformation, from digital currencies to Open Finance to AI-driven banking. As the person responsible for the financial health of the institution, how are you thinking about investment allocation in an environment where the technology landscape is shifting so rapidly?
The way I think about it is in layers. There are investments in core infrastructure that are non-negotiable: cybersecurity, regulatory technology, core banking modernisation. These protect the franchise and ensure compliance. Then there are growth investments: digital channels, Open Finance, AI-driven analytics, and payment innovation such as AE Coin, Aani and the Central Bank Digital Currency. These expand the revenue base. And then there are exploratory investments where we are testing, learning and building optionality.
The allocation across those layers is dynamic. We do not set a fixed technology budget and leave it untouched for the year. We reassess continuously based on what is delivering results and where the market is moving. The 65% increase in depreciation and amortisation this quarter, from AED 20 million to AED 32 million, gives you a sense of the investment cycle we are in. Capital is being deployed and assets are coming into service.
What keeps this financially sound is the revenue backdrop. With operating income growing 6.2% and a cost-to-income ratio at 26.90%, we have the capacity to invest at pace without compromising returns.
CBD’s non-performing loan ratio improved significantly year on year, reflecting strong asset quality even in a complex regional environment. What does prudent risk management actually look like in practice at CBD, and how has your approach evolved given the current geopolitical and economic climate?
In practice, it starts with identification. We have mapped the sectors most exposed to the current environment: hospitality, commercial real estate, contracting, manufacturing, trade and retail. Our Credit and Business teams run enhanced reviews across those portfolios on an ongoing basis, engaging with borrowers before stress materialises rather than after.
Our IFRS 9 governance has also evolved. The IFRS 9 Committee adjusted the macroeconomic scenario weights this quarter, placing greater emphasis on the downside. We have added approval layers for facility disbursements and tightened underwriting for new-to-bank clients in vulnerable sectors. For SME clients facing short-term cash flow pressures, we have supported them through deferrals and restructuring, in line with CBUAE guidance.
The output is in the numbers: NPL ratio at 3.55%, among the lowest in the Bank’s history, down 74 basis points year-on-year. Coverage at 104.72%, and 146% including collateral on Stage 3 loans. Total allowances across the portfolio stand at AED 4.66 billion. We are conservatively provisioned and actively managing risk across every segment.
