Abu Dhabi Commercial Bank (ADCB), UAE\'s third biggest lender, yesterday reported a fiscal second quarter net profit of Dh1.34 billion, compared to a net loss of Dh531 million in the corresponding period last year. \"The bank\'s second quarter profitability was driven by both interest income and non-interest income. Net interest margins have also improved for the second quarter,\" Deepak Khullar, ADCB\'s chief financial officer, told Gulf News, shortly after the bank announced its second quarter results. \"The costs to income level was held at 34 per cent level for the first half of 2011, which is higher than the 32 per cent for the first half of 2010,\" Khullar added. In its statement, ADCB said it reported a first-half 2011 net profit of Dh1.92 billion compared to a net loss of Dh306 million for the first half of 2010 with its earnings per share up at Dh0.33 compared to Dh0.07 in the corresponding period, a year earlier. Article continues below Doubtful loans \"Impairment allowances on doubtful loans and advances, net of recoveries amounted to Dh1.06 billion in the first half of 2011, compared to Dh1.69 billion in the first half of 2010,\" said ADCB. For the first half of the year, the bank took an additional charge for portfolio impairment provision of Dh275 million. \"Portfolio impairment allowance of Dh1.92 billion represents 1.44 per cent of credit risk weighted assets as at 30 June 2011,\" ADCB added. Commenting on the bank\'s results, Ala\'a Eraiqat, ADCB\'s chief executive officer, said: \"Over the first half of the year, we have succeeded in delivering both top and bottom line growth, while maintaining a conservative approach to risk management. We have maintained our disciplined approach to risk management and focused on delivering our strategic objectives to maximise shareholder return and build a stronger, more robust ADCB.\" Including the exposure to Dubai World, the bank\'s non-performing loan (NPL) ratio stood at 11.3 per cent and provision coverage at 40.3 per cent, compared to NPL ratio of 11.1 per cent and provision coverage of 44.1 per cent as of December 31, 2010. As of June 30, ADCB\'s total assets amounted to Dh179 billion, its gross customer loans were at Dh123 billion, total customer deposits stood at Dh106 billion, while its market capitalisation was Dh17 billion. Shares of ADCB on the Abu Dhabi Securities Exchange yesterday closed unchanged at Dh3.12. ADCB is owned 58.08 per cent by the Abu Dhabi Government through the Abu Dhabi Investment Council. \"ADCB\'s provisions on investments and loans were higher than our expectations. Excluding the one-off gain from the stake sale of RHB, the bank\'s earnings were below our expectations,\" Shabbir Ahmad, banking analyst with EFG-Hermes, told Gulf News.