(Adds detail, context)
By Tom Arnold
DUBAI, April 11 Qatar National Bank
(QNB) reported a 12 percent rise in first-quarter net
profit on Tuesday, fuelled by double-digit loan growth after its
takeover of Turkey's Finansbank.
The 2.7 billion euro ($2.86 billion) acquisition completed
in June helped to secure QNB's position as the largest lender in
the Middle East and Africa by assets, but it also exposed the
bank to soured loans in Turkey after the economy wobbled in the
wake of last year's failed coup.
As a result, QNB reported a hefty jump in bad loans to
398.93 billion riyals ($109.6 billion) in the quarter, up from
20.12 billion riyals a year earlier and lifting its
non-performing loans ratio to 1.8 percent from 1.4 percent.
QNB, which is 50-percent owned by the Qatar Investment
Authority sovereign wealth fund and is the Gulf's largest
lender, posted a better than expected net profit of 3.2 billion
riyals in the three months to March 31.
Arqaam Capital analysts had forecast a quarterly net profit
of 3 billion riyals.
Loan growth was up 33 percent year on year to 536 billion
riyals, while customer deposits rose by 34 percent to 541
The bank's loan to deposit ratio stood at 99 percent, just
below the 100 percent cap set by Qatar's central bank, which
takes effect from the end of 2017.
QNB, which is present in more than 30 countries including
its ownership of a business in Egypt and a 23.5 percent stake in
pan-African lender Ecobank International, has also been
broadening its horizons in Southeast Asia to boost growth
outside its small domestic market.
The bank also began operating in Saudi Arabia capital Riyadh
last month, it said, offering wholesale and corporate banking
products, including structured and project finance and
QNB was the second Gulf bank to report earnings on Tuesday,
with Dubai Islamic Bank (DIB), the United Arab
Emirates' largest sharia-compliant lender, having posted a 4
percent increase in first-quarter net profit.
($1 = 0.9425 euros)
($1 = 3.6398 Qatar riyals)
(Editing by David Goodman)