Arab Bank Group Reports USD 218.3 Million in Net Profits
Arab Bank Group continued its strong financial performance during the first quarter of 2016, reporting net profit after taxes and provisions of USD 218.3 million, compared to USD 217.2 million for the same period last year. Shareholders equity, meanwhile, rose to USD 8 billion.
The Bank’s balance sheet remains strong with loans and advances growing by 3% to reach USD 24.4 billion vs USD 23.7 billion in the first quarter of 2015. Customer deposits grew by 2% to reach USD 35.4 billion, compared to USD 34.7 billion for the same period last year. Excluding the effect of foreign currency devaluations, both loans and customer deposits grew by 4%.
Mr. Sabih Masri, Arab Bank’s Chairman commented that the Bank remains on track to deliver solid financial performance. The first-quarter results are a testimony to the Bank’s market leadership and successful strategy. Mr. Masri added that the Bank benefited from its well diversified asset base and geographical spread.
Mr. Nemeh Sabbagh, Arab Bank’s CEO, commented that net operating income grew by 5% excluding non-recurring items, driven by the Bank’s focus on its core banking activities and prudent cost control policy. The Bank maintained a healthy cost-to-income ratio of 39.6%, and non-performing loans to total loans ratio of 4.7%, reflecting the Bank’s high quality loan book in addition to the effective management of credit risk.
Mr. Sabbagh added that the Bank continues to maintain a high level of liquidity with its loan-to-deposit ratio reaching 68.9%, in addition to its conservative provisioning policy with a coverage ratio of 109% as of March, 31st 2016.
Mr. Masri concluded that the Bank will continue to expand its footprint in the region in line with its strategic objectives, while focusing on generating sustainable revenue growth and prudent risk management.
Arab Bank was named the Best Bank in the Middle East 2016 by Global Finance, the New York-based magazine for finance.
I'll take some of that liquidity
Arab Bank's market share in Qatar is less than 5% because they have a very primitive lending policy, as a result their loan book does not grow, as compared to other banks, many of which (banks) are very new but have far bigger loan and income book, like Masraf Al Rayyan and Barwa Bank. This Bank is one of the oldest banks but has a policy of placing the ample liquidity in the inter bank market, instead of lending. Lending is the primary role of any commercial, where the margins in shape of interest and incomes are far higher than the inter bank market.
In Qatar most of other banks use Arab Bank's un-used cash as a short term borrowing against small margin over Qibor in order to cover their daily, weekly cash gaps.
Given the huge cash available at hand, Arab Bank in Qatar can double its income within few months, provided it starts lending to the solid business groups in Qatar.
Congrats, It's result of proper planning & hard work ....... Very nice ...............
This is exciting news - so glad you posted this because I was just reading that iStandard & Poor’s sees increased risks for Qatar's banks and has cut its credit rating for the Commercial Bank of Qatar, established in the 1970s, citing the significant decline in energy prices as a risk to its operating revenues.
It downrated CBQ to BBB+ from A- and increased the risk score for the country’s banking sector as a whole, given an expected slowdown in revenues
This is exciting news - so glad you posted this because I was just reading that iStandard & Poor’s sees increased risks for Qatar's banks and has cut its credit rating for the Commercial Bank of Qatar, established in the 1970s, citing the significant decline in energy prices as a risk to its operating revenues.
It downrated CBQ to BBB+ from A- and increased the risk score for the country’s banking sector as a whole, given an expected slowdown in revenues