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Tribune News Network
Doha
Commercial Bank has reported a whopping 376 percent increase in net profit to QR855 million for six months ending June 30 from QR180 million for the same period last year.
Similarly, the group's net operating income jumped 3.7 percent to QR1.833 billion from QR1.767 billion. Its net interest income increased 8.2 percent to QR 1.328 billion from QR1.228 billion, while the net interest margin edged up 0.1 percent to stand at 2.3 percent as of June 30, 2018.
Non-interest income in the first half of this year decreased 6.5 percent to QR504 million from last year's QR539 million. The bank attributed the overall decrease in non-interest income to lower returns from investment securities as equity holdings were scaled down in line with the strategic plan and lower foreign exchange income.
Total operating expenses were tightly managed at a group level. It went down 9.7 percent to QR620 million for the half year from QR688 million for the same period in 2017. Costs reductions were primarily driven by lower staff and administrative expenses.
The group's net provisions for loans and advances decreased 51.9 percent to QR462 million from QR962 million and non-performing loan (NPL) ratio declined to 5.39 percent from 5.64 percent. It more or less maintained its loan coverage ratio at 84.2 percent at this end of the first half of 2018 when compared with 84.3 percent recorded for the first half of last year.
The bank delivered a balance sheet growth of 4.8 percent as of June 30, 2018, with total assets at QR 139.9 billion compared with QR133.4 billion for the same period in 2017. Total asset growth was driven mainly by an increase of QR3.6 billion in loans and advances and QR2.9 billion in investment securities.
Loans and advances to customers increased by 4.3 percent to QR87.2 billion from QR83.6 billion for the same period in 2017. The growth in lending has been generated mainly from the semi-government and services sectors.
Investment securities increased 15.2 percent to QR21.7 billion from QR18.8 billion due to increase in government bonds.
The group's customer deposits increased 1 percent to QR75.1 billion from QR74.4 billion.
"The Qatari economy remains extremely resilient, demonstrating sustained GDP growth with Fitch and Moody's upgrading Qatar's outlook from negative to stable. In this, the second year of our five year plan, the bank has made very good progress in reshaping its business for sustained growth.
"As Commercial Bank's activities closely align with the strategic economic objectives of the nation, our bank is well positioned to benefit from the resilience and growth of the economy," said Board Chairman Sheikh Abdullah bin Ali bin Jabor al Thani
Hussain al Fardan, Commercial Bank's Vice Chairman, said,"This quarter, the bank continues to position itself to show significant improved bottom line performance in coming years. For example, the bank achieved a successful issuance of a $500 million bond as part of its European Medium Term Note (EMTN) Programme.
The bond issuance was twice oversubscribed, a clear indication of the confidence of international investors in the strength and stability of Qatar's economy and a testament to the growth prospects of Commercial Bank."
Joseph Abraham, Commercial Bank's Group Chief Executive Officer, said,"The benefits of our five-year strategic plan and its continued execution are evident in our H1 2018 results, with a consolidated operating profit of QR1.21 billion and a net profit of QR855 million."
