Al Khaliji has witnessed an almost a flat net profit of QR320mn in the six-month period ended June 30, 2017 despite stronger expansion in net interest earnings.
The net profitability was driven by a growth of 3.4% in operating income, effective cost management leading to lower operating expenses and prudent provisioning on the credit portfolio, a bank spokesman said after its board meeting.
The bank’s capital adequacy ratio stood at 15.73%, as per Basel-III standards, compared to 15.8% in the previous year period.
“We continue to deliver on our strategic objectives, and little has changed in this regard, despite the current challenges,” Al Khaliji chairman and managing director Sheikh Hamad bin Faisal bin Thani al-Thani said.
Net operating income expanded 3.4% year-on-year to QR609.8mn with net interest income expanding 9% to QR496.2mn.
“Improving our net interest income has been a key goal for us and was achieved by more focused asset and liability management,” according to Fahad al-Khalifa, Al Khaliji’s group chief executive.
He said the bank’s strong cost control policy has delivered an efficiency (cost-to-income) ratio of 28% at end June 2017 compared to 32% for the same period last year. “As a result, our operating profit before impairment charges was higher by 9% compared to the first half of 2016,” he said.
Highlighting that the bank is carefully managing its credit impairments and has adopted a pragmatic approach to building suitable provisions to protect against potential future shocks, al-Khalifa said this is reflected in higher impairment charges of QR115mn to June 2017, and has resulted in consistent first half profits year-on-year.
Total assets stood at QR58.25bn with loans and advances at QR35.2bn as the bank continues to deleverage some of its overseas operations.
Al Khaliji’s deposits were at QR32.2bn, up 5.7% year-on-year, reflective of its continuous efforts to strengthen its funding base.
Highlighting that the bank’s liquidity conditions remains strong, Al Khaliji said the coverage ratio stood at 112.8% at the end of June 30, 2017 compared to 107.6% in the comparable period of 2016.
“The economy of Qatar remains strong and supporting our domestic economy remains at the heart of our strategy,” al-Khalifa said.
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