DOHA: QNB Group, the largest lender in the region, continued to record robust growth in profitability posting a full-year net profit of QR10.5bn for 2014, up by 10.3 percent from 2013.
Based on the strong financial results, the Group’s Board of Directors is recommending to the General Assembly the distribution of a cash dividend of 75 percent of the nominal share value (QR7.5 per share).
The Group’s prudent cost control policy and strong revenue generating capability allowed it to maintain an efficiency ratio (cost to income ratio) of 20.8 percent, which is considered one of the best ratios among financial institutions in the region.
Total assets increased by 9.7 percent from December 2013 to reach QR486bn, the highest ever achieved by the Group. This was the result of a strong growth rate of 8.8 percent in loans and advances to reach QR338bn. The Group was able to maintain the ratio of non-performing loans to gross loans at 1.6 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 124 percent in December 2014.
At the same time QNB Group increased customer funding by 7.4 percent to QR360bn. This led to the Group’s loan to deposit ratio reaching 94 percent. Total equity increased by 7.9 percent from December 2013 to reach QR58bn as at 31 December 2014. Earnings per Share reached QR14.9 , compared to QR13.5 in December 2013.
The Group started implementing updated QCB and Basel III requirements for the calculation of the Capital Adequacy Ratio (CAR) from early 2014. The ratio stood at 16.2 percent as at 31 December 2014, higher than the regulatory minimum requirements of the Qatar Central Bank. The Group is keen to maintain a strong capitalisation in order to support future strategic plans.
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. Based on the Group’s continuous strong performance and the expanding international presence, the Group improved its ranking as the most valuable brand in the MENA region, with a world ranking of 101 (Brand Value: $1.81bn) from 120 in 2012 (Brand Value: $1.31bn).
In the second half of 2014, QNB acquired a 19.4 percent stake (both ordinary and QNB convertible preference shares) in Ecobank Transnational Incorporated (Ecobank), the leading pan-African bank. Ecobank is a strategic partner for QNB and the acquisition of this stake is a fundamental step towards QNB’s strategy of being a MEA Icon by 2017.
In the second half of 2014, QNB also acquired an additional stake in QNB Indonesia, (rebranded from QNB Kesawan) to have a total stake of 82.59 percent.
The Peninsula
