DOHA: Al Khaliji (KCBK) yesterday reported net profit of QR109m for the first quarter ended March 31. Loans and advances for the period grew by 11 percent, to reach QR22.9bn, and net interest income increased by 12 percent.
The acceleration in sustainable recurring revenues is in line with the bank’s strategy to progressively rely less on investment gains for future growth in favour of increased proceeds from a growing banking franchise.
“Al Khaliji is starting the year with a solid financial performance supported by a growing banking franchise. Following the Group’s strong performance in 2013 it was expected that investment returns would be more muted this year given the developments in quantitative easing and US treasury rates,” said Rob McCall, Group CEO, Al Khaliji.
The bank has stepped up financing of large infrastructure projects and its private sector preferred customers to drive an increase in its lending book, up 63 percent year-on-year, while preserving superior asset quality as reflected in a low NPL ratio. al khaliji’s investment portfolio now accounts for 37 percent of total assets in contrast to the end of March last year when it made up half of the bank’s assets.
Al Khaliji France SA’s net profit reached QR16.3m, up 5 percent compared to Q1 2013 and represents 15 percent of the Group net income.
Net profit for the first quarter of this year is QR109.2m compared to QR131.5m for the same period in 2013. Net interest income increased by 12 percent, to QR165.9m, over the prior quarter. Net fee and commission income of QR37.8m grew by 11 percent on Q4, 2013; however it is QR9.4m lower year-on-year owing to non-recurring revenues. This reduction flows through on a first quarter comparative basis to net operating income which is QR213.8m.
Income from the banking franchise now accounts for 92 percent of profits, compared to 81 percent last year, reflecting a growing book with less reliance on investment income which made up 19 percent in Q1, 2013.
Total assets reached QR 43.7bn in the first quarter of 2014, up 27 percent from Q1, 2013 and up 6 percent from the previous quarter ending December 2013.
Al Khaliji France represented 10 percent of the group’s total assets. Loans and advances rose to QR22.9 billion, 63 percent higher than the same period end of the prior year and 11 percent higher than the previous quarter.
Deposits reached QR21.7bn, up 25 percent compared to the first quarter of 2013 and up 9 percent from the fourth quarter of 2013.
Earnings per share were QR0.30 for the first three months of this year. The bank’s capital adequacy ratio was 17.7 percent as per Basel III. Non-performing loans stood at QR62.4m at the end of March 2014, down 11 percent from end of December 2013. The NPL ratio, at 0.27 percent, continues to improve quarter-on-quarter.
Sheikh Hamad bin Faisal bin Thani Al Thani, Chairman and Managing Director said: “Al Khaliji continues to expand its banking franchise in a manner that is capable of delivering long term value to its shareholders and customers. The financial strength of the organisation and our commitment to deliver on our identified strategic initiatives ensures we are well positioned to deliver on future business growth.”