NB achieves record-breaking financial results for the financial year ended 31st December 2007
- Net profit up by QR510 million (25.5%) to QR2,508 million from QR1,998 million in 2006
- Total assets up by QR42.7 billion (59.6%) to QR114.4 billion
- Total Loans and advances and financing activities up by QR19.8 billion (42.9%) to QR66.1 billion
- Total Customer deposits and unrestricted investment accounts up by QR23.6 billion (42.3%) to QR79.4 billion
- Earnings per share up to QR14.5 from QR11.7
Doha, 15th January 2008 – H.E. Yousef Hussain Kamal, the Chairman of the Board of Qatar National Bank (QNB), announced today that the Bank’s Board of Directors met on Monday 14th January 2008, to review the Bank’s financial statements for the year ended 2007. Net Profit surpassed for the first time, the QR2.5 billion mark as a result of the success in diversifying income sources and the maintenance of a strong efficiency ratio (total costs to total income).
H.E. the Chairman added that Net Profit rose by 25.5% to reach QR2,508 million, compared with the net profit of QR1,998 million delivered in 2006. The Bank recorded a substantial growth in all of its income components, with total income increasing by QR767.8 million (28.4%) to QR3,469 million.
Net interest income and income from Islamic financing activities increased by QR245.4 million (14.5%) to QR1,932 million mainly due to the Bank’s success in maintaining its interest margins, the diversification of products and services, and a strong increase in the volume of business activities.
Other operating income continued its strong growth reaching QR1,537 million representing an increase of QR522.4 million (51.5%), with net fees and commission income up by QR273 million (60.2%) to reach QR726.3 million and foreign exchange income growing by QR57.3 million (48.6%) to QR175.2 million.
At the same time, income from investment related activities showed strong growth with dividend income growing by QR35.3 million (40.7%) to QR122.0 million, reflecting high dividend distribution of the Bank’s equity portfolio. Realised profit from sale of equity securities generated a gain of QR374.5 million, and income from associates amounted to QR122.9 million.
General and administrative expenses increased by QR118.2 million (15.1%) to reach QR899.6 million. The increase is mainly attributed to an increase in staff costs, marketing expenses and IT systems development aiming to diversify and improve customer services. The Bank’s success in improving efficiency and increasing productivity was reflected in its efficiency ratio, being total costs as a percentage of income, which improved to 25.9% in 2007, from 28.9% in 2006.
Recoveries of provision for impairment of loans and advances amounted to QR19.7 million, compared to QR139.2 million in 2006. The Bank’ success in improving its collection processes and the effectiveness of its credit risk management policies is clearly reflected in its ratio of non-performing loans to gross loans which improved from 1.2% in 2006 to just 0.7% in 2007.
At year end 2007, the Bank’s total assets stood at QR114.4 billion reflecting an increase of QR42.7 billion (60%). The growth in total assets was mainly attributable to the growth in loans and advances that increased by QR19.8 billion (43%), to reach QR66.1 billion. Similarly, customer deposits and unrestricted investment accounts grew by QR23.6 billion (42.3%) to reach QR79.4 billion, mainly due to the increase in individual and corporate deposits.
Al Watani Al Islami also succeeded in achieving excellent results during the 2007, with financing activities increasing by QR2.5 billion (125%) to reach QR4.5 billion. Net profit for Al Watani Al Islami rose by QR73.2 million (97.5%) to reach QR148.3 million. Total assets grew by QR1.3 billion (22%) to reach QR7.2 billion.
Based on the strong financial results and consistent with the Bank’s aim of maximizing return to shareholders’, H.E. the Chairman announced that “the Board of Directors is recommending to the General Assembly the distribution of a cash dividend of 50% of share capital (QR5.0 per share) and a bonus share of 20%, representing one share for every five shares held”.
Mr. Ali Shareef Al Emadi, Group Chief Executive stated “we are very proud of the strong financial results achieved for 2007”, elaborating that this was due to the successful implementation of QNB’s strategy in expanding its operations and services to become a leading financial institution in the region. Further, Mr. Al Emadi indicated that a Press Conference will be held on January 20 at QNB Head Office at 9:00 am to discuss 2007 financial results and achievements.
"QNB proved its credibility as the preferred and reliable partner for both companies and individuals,” Mr. Al Emadi stated. He further elaborated, that during the year, QNB acted as a financial advisor to a number of companies and has participated in the financing of major projects in all economic sectors in Qatar, along with the participation in a number of major projects in the region.
During October 2007, QNB decided to increase its share capital through the issuance of a rights issue that began for two weeks starting from November 4th. The first phase of the rights issue included the issuance of 1 share for every 8 shares held (12.5% of share capital) at a price of QR120 per share that includes the nominal share price of QR10 per share and a premium of QR110.
Among the major achievements for QNB during 2007 is the opening of new branches in Kuwait, Yemen and Oman along with representative offices in Libya and Singapore. In addition, an acquisition of 30.5% was made of The Housing Bank for Trade and Finance in Jordan. Also, an agreement was reached to establish a bank in Syria in which QNB’s stake amounts to 49%, and an approval was obtained to establish a presence in Mauritania.
Another major accomplishment is the successful completion of the largest and most competitive syndicated loan in the region that amounted to US$1.85 billion, in which a large number of major financial institutions participated.
During 2007, QNB launched a group of various products and services. This included its new priority banking service, “QNB First” and “business banking services” where customer needs are pursued on daily bases. The Bank also launched a promotional campaign that go along with its services and products. It also launched a new service EAZYLife that include a range of e-banking services available 24 hours a day through the internet.
As a recognition to its leading role in the financial sector, QNB was granted several awards from specialized financial institutions, as the best bank in Qatar from “Euromoney” , “The Banker”, ”Trade Finance” and “Global Finance”. QNB was chosen as the best bank for internet banking services in the Middle East and was awarded the “JP Morgan Chase Elite Quality Recognition Award”. QNB was designated with the prestigious ISO 27001 Certification for information security management, thus becoming the first bank in Qatar to be awarded this certification.
Affirming the Bank’s commitment towards the country’s remarkable economic and financial growth, QNB participated as a Diamond Sponsor for the Second Qatar Economic Forum which was held under the patronage of H. H. the Emir Sheikh Hamad Bin Khalifa Al-Thani. QNB was also the Diamond Sponsor of the Annual Arab Banking Conference for 2007, and QNB Al Islami was the Strategic Partner and Shari’a & Business Open Forum host for the “Second Annual World Islamic Infrastructure Finance Conference”.
Demonstrating its responsibilities towards the community, as the leading financial institution, QNB was the Platinum Sponsor of “First Qatar International Conference on Newborn Screening” that was organized by Hamad Medical Corporation, and sponsored “The Arab Federation for the Visually Impaired Conference”.
For the sixth time, QNB offered full support to the QNB Volunteer Award Ceremony, an event that takes place annually, to encourage the voluntary work and assume a constructive role in appreciating social services towards Qatari citizens and the development of the country.
In order to provide youths with new opportunities, the Bank participated in ‘Qatar Career Day” to attract qualified Qatari men and women, offering them employment opportunities and career development.
QNB was also the exclusive sponsor of the Souq Wagef Photo Exhibition held in Paris, which was organized by Qatar’s permanent delegation to UNESCO in France and was the official sponsor of the 6th Cultural Festival in Doha.
In the area of sports, the Bank renewed its agreement with Qatar National Olympic Committee through the sponsorship of the four major sport championships in the country: Football, Basketball, Handball, and Volleyball. Also, for the 15th consecutive year, QNB and Qatar Tennis Federation (QTF) signed an agreement, by which QNB was the Official Sponsor of the Tennis tournament. In addition, QNB was the official sponsor of Losail National Cup motorcycle racing campaign, led by Nasser Saleh Al Attiyah, the Middle East car rally champion.