GCC’s biggest bank QNB reports 7% rise in half-year net profit

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Qatar National Bank (QNB Group), the biggest GCC lender by assets, reported a 7 per cent increase in half-year net profit to $2.2bn (QAR8.2bn), citing a “robust and consistent performance” amid a surge in operating income and total assets.

Banks in the GCC region have profited from rising interest rates in the wake of the US Federal Reserve’s moves to increase borrowing costs to curb inflation.

“GCC banks are more profitable than their peers in developed (and many emerging) markets, and they are still growing rapidly,” McKinsey said in a report in June, while noting that a positive macroeconomic environment has shielded the sector from post-pandemic shocks.

The banking group said its operating income rose by 9 per cent to reach QAR20.1bn in the six months to June 30, supported by steady “growth across a range of revenue sources”.

QNB’s half-year deposit base jumped 6 per cent to QAR891bn compared to the same period a year ago, driven by the bank’s diversified customer base, while the loan deposit ratio stood at 98.7 per cent.

“QNB Group’s efficiency (cost to income) ratio stood at 22.4 per cent, which is considered one of the best ratios among large financial institutions in the Middle East and Africa region,” the lender said in a statement.

Meanwhile, the Qatari lender had QAR1.3tn in total assets in the six months ending June 30, a 5 per cent increase, driven by growth in loans and advances by 7 per cent to reach QAR879bn.

Its capital adequacy ratio amounted to 19.2 per cent as at June 30, 2024, while its liquidity coverage ratio and net stable funding ratio expanded by 185 per cent and 105 per cent, respectively. The ratio of non-performing loans (NPL) to gross loans stood at 3 per cent, reflecting the high quality of QNB’s loan book and the effective management of credit risk.

QNB’s board proposed a cash dividend of 33 per cent of the nominal share value (QAR0.33 per share).

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