Ahlibank’s Net Profit QR 631.7 million for the year ended 2016
24 January 2017
Ahli Bank QSC (ABQK) is pleased to announce a net profit of QR 631.7 million for the year ended 2016, a mere decrease of 2.5% over the corresponding period last year (2015: QR 647.7 million), as a result of adopting prudence over growth in navigating various economic and regulatory challenges the banking sector is experiencing exacerbated by a decline in world oil and gas prices.
The following is a summary of the Bank’s strong financial standing:
- The Bank’s Balance Sheet grew by 18.2% over December 2015 to QR 38,165 million, driven mainly by growth in Loans and Advances to fund our customers’ business activities in Qatar.
- Liquid Assets as a percentage to Total Assets stood at 27.8% in December 2016 vis-à-vis 23.7% in December 2015, despite tight liquidity in the region.
- Total Core Funding expanded by 28.8% to reach QR 31,128 million as against QR 24,171 million in December 2015. The funding growth was primarily driven by a 22.7% growth in Customer Deposits to QR 25,011 million and a 73% growth in stable medium term funding to QR 3,880 million in December 2016.
- Stable Funding as a percentage to Total Liabilities improved to 11.6% vis-à-vis 8.1% in December 2015.
- Loan to Deposit ratio improved to 107% as of December 2016 compared to 118% in December 2015 as a 22.7% growth in Customer Deposits outpaced a loan growth of 11.7%.
- Cost to Income Ratio for 2016 remained steady at 30.7%, reflecting efficient management of operating expenses.
- The Return on Average Assets (ROAA) and Return on Average Equity (ROAE) stood solid at 1.84% and 13.6% respectively, despite an increase in balance sheet size and equity base.
- Non-Performing Loans Ratio (NPL) improved to 0.82% as of December 2016 from 1.24% in December 2015, reflecting strong asset quality. Provision Coverage grew stronger to 151% from 126% in December 2015.
Commenting on the full year results of 2016, Sheikh Faisal Bin Abdul-Aziz Bin Jassim Al-Thani, Chairman and Managing Director of Ahlibank stated, “We invested in building our brand with improved market visibility, and have created a solid platform to expand our product range. Earlier in the year, the Junior Savings Account product was launched to build longer term savings, to meet the needs of the emerging youth market, which we see as currently underserved in the Qatar market. In April, the Bank successfully completed its US$ 500M debut fundraising in the international debt capital markets, which was 2.4 times oversubscribed, to diversify our funding base and increase our visibility in international market. Middle East investors took up the largest share (55%), followed by Asia (20%), UK (15%), Europe (6%) and others (4%). We have further improved the stability of our funding structure as well as positioning ourselves with Basel III requirements to begin the next phase of our growth story.
Testimony to the good financial and business performance, Ahlibank received in May 2016 two prestigious leadership achievement awards from the Asian Banker for Best Managed Bank in Qatar in 2016 and Best CEO of the year 2016.
Another milestone in the Bank’s history is Moody's assignment of A2/Prime-1 debut credit ratings to the Bank with Stable outlook in February 2016. The major drivers supporting this rating include Qatar’s solid macro profile, strong asset quality which compares favourably against global peers, improved funding mix, as well as sound capital and profitability metrics. Ahlibank's ratings also factor in the support from Qatari authorities to all banks in the country in case of need.”
The Chairman added: “The 2022 FIFA World Cup event hosting in Qatar is our compass for future direction. Forthcoming infrastructure development will determine the pace of change. Accordingly, we will be rolling out plans to upgrade and overhaul our technology with the view of minimising obsolescence as well as automating our operational processes. We will invest in human capital for sustained performance.”
The Board of Directors of Ahlibank has proposed a cash dividend of 10% (QR 1.0 per share) and a bonus dividend of 5% (5 new shares for every 100 shares held) as the dividend distribution for the year 2016. The dividend proposal intends to maximise shareholders’ wealth, as well the Bank’s internal capital requirements and expansion plans.
These results are based on the audited financial statements, which are subject to the final approval of the Qatar Central Bank and the shareholders. The Board of Directors and its management would like to thank the Qatar Central Bank for its guidance and support.