Mubasher: The National Bank of Kuwait (NBK) reported a 46.9% decline in net profit during the first half (H1) of 2020, as shown by the bank’s financial results.

The net profit amounted to KWD 111.09 million in the first six months of the year, compared with KWD 209.09 million in the same period of 2019.

Earnings per share (EPS) decreased by 51.6% to KWD 14 in H1-20 from KWD 30 in H1-19.

The financial results reflected the change in the operating environment resulting from the COVID-19 pandemic, according to the bank’s statement to Boursa Kuwait.

“The spread of COVID-19 and the constraints imposed by governments around the world to limit its spread, including social distancing measures and lockdowns, have weighed negatively on supply chains and production levels leading to severe disruptions in the global economy,” said Nasser Al-Sayer, Chairman of NBK, commenting on the bank’s results in H1-20.

“The Kuwaiti economy similarly faced unprecedented challenges in the first half of the year. In addition to the negative impact of the pandemic outbreak and spread, the large drop in oil prices added further pressures. This has generally led to a challenging operating environment that will have a negative impact on the overall economy as well as the banking sector in Kuwait,” he added, noting that the bank currently expects a contraction of around 6% in Kuwait’s GDP in 2020.

The bank attributed the lower earnings to higher provisions charges for credit losses and impairment losses, lower net operating income, and higher operating expenses.