ibq net profit jumps 25% to QR500.3m
12 Feb 2017 - 23:39
International Bank of Qatar (ibq)’s net profit for the year ended 31 December 2016 increased by 25 percent to QR500.3m as compared to QR400.1m for 2015.
Operating income increased by 5 percent to QR784.1m, mainly due to a 3 percent increase in foreign exchange to QR68.1m, fees and commission increasing by 4 percent to QR128.6m and investment income posting QR20.9m.
The Bank further expanded its retail distribution network during the year and continued to focus on its strategic initiatives to grow the personal and business banking business segments, resulting in higher variable costs to support increased business volumes. Cost to income ratio stood at 37.3 percent.
The Bank continues its prudent approach to provisioning in the current economic environment. Net Impairment recovery of QR8.3m reported is mainly due to the Corporate & Private banking client recoveries against a net impairment charge QR72.4m mainly related to one Corporate customer which was fully provided for in 2015.
Loans and Advances of QR21.3bn as at December 31, 2016 registered a rise of 3 percent when compared to QR20.7bn as at December 31, 2015 mainly from growth in the Corporate Banking portfolio.
Overall asset quality remained strong, in spite of the deterioration in the broader market conditions. Decline in non-performing loans (NPL) coupled with increase in loan book resulted in drop of NPL to gross loan ratio from 2.2 per cent as at end of December 2015 to 1.2 per cent as at 31 December 2016.
The Bank’s liquidity continued to be comfortable with strong metrics from the Net Stable Funding Ratio, Liquidity ratio and the Liquidity Coverage Ratio (LCR). ibq’s capital adequacy stood at 14.25 per cent (after dividend payout) and was above the regulatory threshold mandated by the Qatar Central Bank.
Commenting on the Bank’s performance, Omar Bouhadiba (pictured), Managing Director said:“Our performance in 2016 was robust, with all parameters pointing in the right direction. Operating income showed good growth in a difficult environment, as did profitability. To preempt any possible challenges to our credit quality that could have come from a weaker economic environment, we focused intensely on credit management. This actually resulted in an improvement of our portfolio, as testified by a drop in our NPL ratio from 2.18 percent in 2015 to 1.21 percent in 2016, low by any standard. Liquidity was adequate at all times, although we had to cope with a rise in funding cost. This was balanced by the rapid growth of non-interest income, which increased 22 per cent. Service excellence remained to our usual high standards, and all surveys show a high level of client satisfaction with our bank.”
The Bank starts 2017 from a solid position. ibq’s total capital adequacy is well ahead of the regulatory requirement set by the Qatar Central Bank we are confident that ibq will maintain its growth trajectory.
Sheikh Hamad bin Jassim bin Jabor Al Thani, Chairman of ibq, added that these results were a solid performance on previous year resulting in the bank generating a net profit at QR500.3m, which was a 25 percent increase. He commended management and staff and their determination throughout the year for producing such a result.