QNB Group: Financial Results for the Six Months Ended 30 June 2018

Group, the largest financial institution in the Middle East and
Africa (MEA) region, announced its results for the six months period
ended 30 June 2018.

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QNB Group Head office in Doha, Qatar (Photo: AETOSWire)

For the first half of 2018, Net Profit reached QAR7.1 billion (USD1.9
billion), up by 7% compared to last year. Total assets increased by 10%
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% to reach QAR604 billion (USD166 billion). This was mainly
funded by customer deposits which increased by 9% to reach QAR614
billion (USD169 billion) from June 2017. This helped to maintain QNB
Group’s loans to deposits ratio at 98.4% as at 30 June 2018.

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%,
from 29.3% last year which is considered one of the best ratios among
large financial institutions in the MEA.

Also the Group’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. Also maintaining the
stock of non-performing loans ratio at 1.8% 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% as at 30 June 2018.

Total Equity reached QAR76 billion (USD21 billion), up by 3% from June
2017. Earnings per share increased to QAR7.4 (USD2.0), compared to
QAR7.0 (USD1.9) in June 2017.

Capital Adequacy Ratio (CAR) as at 30 June 2018 amounted to 15.8%,
higher than the regulatory minimum requirements of the Qatar Central
Bank and Basel Committee.

QNB’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.

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.

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.

*Source: AETOSWire

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