The result fell short of analysts' forecasts but loan loss provisions dropped and income from investments surged. The bank's shares closed 1.22 percent higher at 4.15 dirhams.
"I think loan growth will be in the range of 1-2 percent in the second half, a slightly lower forecast than originally given," Rick Pudner told a conference call. The bank had earlier forecast growth of 3 percent to 4 percent.
The bank has also raised its forecast for growth in the UAE's GDP to 4.6 percent this year from a previous 4 percent with the average oil price remaining 40 percent higher. "All this is positive," he said.
Dubai's top lender, which reshuffled its board last month, made a net profit of 744 million dirhams ($202.6 million) for the three months ended June 30, compared with 398 million dirhams in the same period last year.
Four analysts polled by Reuters had estimated an average profit of 746.3 million dirhams for the second quarter, while the average net profit estimate of analysts posted on the lender's website was 982 million dirhams.
Analysts said the quarterly results showed that the lender was on its way back to recovery after exposure to the emirate's debt-laden conglomerates led to a sharp surge in non-performing loans and provisions in the last two years.
"The numbers are slightly below expectations but all in all they're not bad," said Haissam Arabi, chief executive and fund manager at Gulfmena Investments in Dubai said.
"That shows you the bank is well on its way to recovery. While we didn't see loan growth, we should see that start to pick up in the next two quarters. Overall, the numbers are satisfactory."
Profit for the first six months climbed 46.7 percent over the same period last year to 2.2 billion dirhams, ENBD said in a bourse statement earlier.
Impairment provisions, the amounts set aside to meet losses from bad loans and investments, fell 18 percent to 981 million dirhams during the quarter, helping aid profit growth. Total provisions stood at 3.8 billion dirhams for the six-months ended on June 30. Provisions are likely to rise in line with the bank's conservative policies.
"You could see provisions going up as defensive play rather than specifics," Chief Financial Officer Surya Subramanian said on the conference call.
The banks non-performing loans (NPLs) ratio for 2011 will stay at 13-14 percent, he added.
Non-interest income climbed by 43 percent in the second quarter due to improved income from investment securities, the company said, adding that trading business was affected by the political unrest in the region and debt concerns in the euro zone.
Loans fell 2 percent in the first half, signaling lending activity remains subdued in the region, while deposits were stable since December at 200.5 billion dirhams, the statement said.
The bank may tap the debt market on an opportunistic basis, said Pudner. "It is our intention as soon as pricing matches our expectation," he said.
In June Emirates NBD reshuffled its board of directors, resulting in the appointment of Sheikh Ahmed bin Saeed Al-Maktoum as chairman. The move could signal potential changes to come in Dubai's banking sector, analysts said.
ENBD shares have risen more than 50 percent this year outperforming the benchmark which is down 6.7 percent year-to-date.
