DOHA: Driven by a strong operating income, QNB Group, the largest lender in the region, posted 10.2 percent increase in its net profit for the six months ended June, 2015. The bank reported a net profit of QR5.6bn during the period, compared to QR5.1bn in the corresponding period last year.
The bank’s operating income increased to QR8.2bn, up by 7.5 percent compared to June 2014, demonstrating QNB Group’s success in achieving strong growth across the range of revenue sources.
Net interest income increased by 6.7 percent to reach QR6.4bn, with net fee and commission income and net gain from foreign exchange reaching QR1.1bn and QR0.4bn, respectively, reflecting success in diversifying sources of income.
The Group’s cost control policy and strong revenue generating capability allowed it to maintain an efficiency ratio of 21 percent, which is considered one of the best ratios among financial institutions in the region.
QNB’s total assets increased by 9.7 percent from June 2014 to reach QR511bn, the highest ever achieved by the Group. This was the result of a growth rate of 9.2 percent in loans and advances to reach QR356bn.
The Group was able to maintain the ratio of non-performing loans to gross loans at 1.5 percent, a level considered one of the lowest amongst banks in the Middle East and Africa, reflecting the high quality of the Group’s loan book and the effective management of credit risk. The Group’s conservative policy in regard to provisioning continued with the coverage ratio reaching 133 percent in June 2015.
At the same time QNB Group increased customer funding by 10.4 percent to QR381bn. This led to the Group’s loan to deposit ratio reaching 93 percent.
Total equity increased by 7.4 percent from June 2014 to reach QR58bn as at 30 June 2015. Earnings per share reached QR8, compared to QR7.2 in June 2014.
Capital Adequacy Ratio (CAR) calculated as per the QCB and Basel III requirements stood at 14.4 percent as at 30 June 2015, higher than the regulatory minimum requirements of the Qatar Central Bank and Basel Committee. The Group is keen to maintain a strong capitalisation in order to support future strategic plans.
During March 2015, Fitch Rating agency upgraded QNB Group to AA-/F1+ on the back of the strength of State of Qatar’s sovereign rating. QNB Group has maintained its credit rating from all other rating agencies and is considered one of the highest in the region. This is a result of QNB Group’s strong financial position, high quality of its assets and leading position in the financial sector.
As a result of the Group’s high credit ratings and outstanding asset quality, it was selected as one of the world’s 50 safest financial institutions by Global Finance.
The Peninsula
