Commercial Bank's headquarters located in West Bay, Doha.
The Commercial Bank Group has reported a net profit of QR91.2m for the first quarter (Q1) of the current financial year ended March 31, 2017. The net profit has declined by 66.7 percent compared to QR274.2m for the corresponding period last year (Q1, 2016).
The Group’s operating profit (including its subsidiaries and associates) stood at QR530.1m for Q1, 2017, up by 4.3 percent compared to the same period last year, according to the financial statement released by the Bank.
Sheikh Abdullah bin Ali bin Jabor Al Thani, Chairman of the Board of Directors of Commercial Bank, said: “Commercial Bank has started the year on a strong note, with an improved capital position and with the strategic reshape plan well under way. As we look towards Qatar’s future, we have re-aligned the Bank’s strategy to focus on sustainable earnings and growth, while continuing to positively contribute to the development of the local economy. AA rated by Fitch, Qatar’s economy is resilient and set for a healthy GDP growth of 3.6 percent in 2017, which will also support the growth of our bank.”
Commenting on the financial performance, Hussain Al Fardan, Commercial Bank’s Vice Chairman, added: “Commercial Bank delivered an operating profit of QR530.1m in the first quarter of 2017. Loans have grown by 8.6 percent year on year at the Group level. Growth in lending was driven by services, consumption and industry sectors.”
Net operating income for the Group decreased by 4.2 percent to QR885.4m for the quarter ended March 31, 2017, down from QR924.7m achieved in the same period in 2016.
Net interest income for the Group decreased by 4.1 percent to QR598.5m for the quarter ended March 31, 2017 compared to QR624.3m achieved in the same period in 2016, mainly due to a change in the business mix in ABank resulting in lower income. Net interest margin remains stable at 2.2 percent as compared to Q4, 2016.
Non-interest income for the Group decreased by 4.5 percent to QR286.9m for the quarter ended 31 March 2017 compared with QR300.5m. The overall decrease in non-interest income was due to lower income from investment securities and other income. Total operating expenses were well controlled for Group and these decreased by 14.7 percent at QR355.4m for the quarter ended March 31, 2017 compared with QR416.5m for the same period in 2016. Costs reduced in both staff as well as administrative expenses.
The Group’s net provisions for loans and advances increased by 84.7 percent to QR478.7m for the quarter ended March31, 2017, from QR259.1m for the same period in 2016. The non-performing loan (NPL) ratio has remained at 5 percent at March 31, 2017 as compared to that of December 2016, however, loan coverage ratio has increased to 85.9 percent as at March 31, 2017 compared to 78.9 percent as at December 2016.
The Group delivered balance sheet growth of 9.5 percent at the end of March 2017 with total assets at QR135.1bn, compared to QR123.3bn at the end of March 2016. Total asset growth was driven mainly by an increase of QR6.5bn in loans and advances and QR3.7bn in investment securities. Group’s loans and advances to customers increased by 8.6 percent to QR82bn at March 31, 2017 compared with QR75.5bn at the end of March 2016. The growth in lending has been generated, mainly in services, consumption and industry sectors.
