July 16, 2018
By Peter OBIORA InvestAdvocate
Lagos (INVESTADVOCATE)-QNB Group, the largest financial institution in the Middle East and Africa (MEA) region, said its Net Profit reached QAR7.1 billion (USD1.9 billion), up by 7.0 percent in its six months (H1) period ended 30 June 2018 compared to last year.
QNB says total assets in the review period increased by 10 percent from June 2017 to reach QAR846 billion (USD232 billion), the highest ever achieved by the Group.
The key driver of total assets growth was from loans and advances which grew by 9 percent to reach QAR604 billion (USD166 billion). “This was mainly funded by customer deposits which increased by 9 percent to reach QAR614 billion (USD169 billion) from June 2017. This helped to maintain QNB Group’s loans to deposits ratio at 98.4 percent as at 30 June 2018,” according to an emailed statement on Monday from Aetoswire.
According to the statement, the Group’s drive for operational efficiency is yielding cost-savings in addition to sustainable revenue generating sources. “This helped QNB Group to improve the efficiency ratio (cost to income ratio) to 27.2 percent, from 29.3 percent last year which is considered one of the best ratios among large financial institutions in the MEA,” the statement added.
The largest financial institution in the Middle East and Africa said it’s strong recovery efforts helped reduce the net impairment charge on QNB’s loan book during the year demonstrating strong credit quality of the bank’s asset base.
It further affirmed that maintaining the stock of non-performing loans ratio at 1.8 percent 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 maintained the coverage ratio at 110 percent as at 30 June 2018.
The company disclosed that Total Equity reached QAR76 billion (USD21 billion), up by 3 percent from June 2017. Earnings per share increased to QAR7.4 (USD2.0), compared to QAR7.0 (USD1.9) in June 2017.
QNB says it’s Capital Adequacy Ratio (CAR) as at 30 June 2018 amounted to 15.8 percent, higher than the regulatory minimum requirements of the Qatar Central Bank and Basel Committee.
The company said it’s successful funding from the international markets during the first six months of 2018 which includes, amongst others, (1) capital market issuances of USD560 million (AUD700 million) with a 5 and 10-year maturity in Australia and (2) USD720 million bonds with 30 year maturity in Taiwan. “This reflects the Group’s success in diversifying funding sources by entering new debt markets, sourcing sustainable long-term funding, extending the maturity profile of funding sources and the trust of international investors in the strong financial position of QNB Group and its strategy,” the statement noted.
In June 2018, Fitch Ratings has revised the Outlook to Stable due to successful management of the impact from the blockade. Also QNB remains the highest-rated bank in Qatar and one of the highest-rated banks in the world with the fourth highest rating from the major rating agencies of Moody’s, Standard & Poor’s and Fitch.
The QNB Group serves a customer base of more than 22 million customers with more than 29,000 staff resources operating from 1,100 locations and 4,400 ATMs.
