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Qatar Commercial Bank profit up 19% to QAR1.55m in 9m

Qatar Commercial Bank profit up 19% to QAR1.55m in 9m
The Commercial Bank
CBQK
-0.50% 4.93 -0.03
The Commercial Bank of Qatar and its subsidiaries and associates announced today its financial results for the nine months period ended September 30 ,2014.

The Bank delivered a net profit of QAR1,553 million for the nine months of 2014, a 19% increase in profitability compared to the equivalent nine months of 2013.

On a quarterly basis, Commercial Bank generated net profit of QAR503 million in the third quarter 2014, an increase of 79% compared to the third quarter 2013.

Net operating income increased by 22% to QAR2,951 million in the nine months of 2014, up fromQAR2,419 million achieved in the same period in 2013. ABank delivered net operating income ofQAR626 million for the nine months of 2014 an increase of 11 % over the same period in 2013.

Net interest income was QAR1,955 million for the nine months ended September 2014, 26% higher than in the same period in 2013, reflecting strong growth in lending activities and the consolidation of ABank. ABank contributed QAR493 million, 25% of the total net interest income.

Meanwhile , net interest margin increased to 2.8% as compared to the second quarter of 2014 at 2.7%.

Non-interest income was up 15.4% to QAR 996 million in the first nine months of 2014 comparedwith QAR 863 million for the same period in 2013 with ABank contributing QAR133 million.

The overall increase in non-interest income was due to higher net fee and commission income and was partially offset by lower income from investments securities and foreign exchange.

Total operating expenses were up 36% to QAR1,237 million in the first nine months of 2014 compared with QAR911 million for the same period in 2013. Excluding ABank, expenses increased by 9% for the first nine months of 2014 compared to the same period in 2013 as Commercial Bank continued to invest in its people and infrastructure.

The Bank’s net provisions for loans and advances were QAR378 million for the nine months ended September 2014, up from QAR368 million provided in the same period for 2013.

However ,the nonperforming loan ratio has reduced to 3.71% at September 2014 compared with 3.82% at the end of June 2014 and the coverage ratio has increased to 68.3% as at September 2014 compared to 67.3% in June 2014.

Impairment provisions on the Bank’s investment portfolio reduced to QAR43 million for the nine months ended 30 September 2014 compared with QAR77 million for the same period in 2013.

Commercial Bank delivered strong balance sheet growth at the end of the first nine months of 2014 increasing by 8.6% with total assets at QAR114.3 billion, compared to QAR105.3 billion at the same period in 2013. ABank contributed QAR18.7 billion of assets for the period. Balance sheet growth was driven mainly by an increase of QAR5.8 billion in lending to customers combined with an increase of QAR2.4 billion in due from banks.

Loans and advances to customers were up by 9% to QAR70.7 billion at 30 September 2014 compared with QAR64.9 billion at the end of September 2013. The growth in lending since 30 September 2013 has been generated, mainly, in the Government, Contracting, Real Estate and Retail Sectors.

Loans and advances to customers of QAR12.7 billion at ABank were included at 30 September 2014. Investment securities were down by 4.5% to QAR 13.6 billion at 30 September 2014 compared with QAR14.3 billion at the end of September 2013. The reduction in investment securities is mainly due to the maturity of Qatar Government bonds. Investment securities of QAR2.5 billion at ABank were included at 30 September 2014.

The lender Customers’ deposits have grown marginally by 0.8% to QAR58.1 billion at 30 September 2014, compared with QAR57.7 billion as at 30 September 2013.

The increase in deposits has come mainly from higher demand and savings balances. Partially offsetting this increase was a reduction in time deposits due to the Bank having received funds from the EMTN issuance in June 2014. This reflects our strategy to ensure continued diversification of our funding base and our focus on growing low cost funds.