(MENAFN- Gulf Times) Ahli Bank has reported more than 1% year-on-year increase in net profit to QR639.7mn in 2017.
The lender has recommended a total of 15% dividend (10% cash and 5% bonus shares) to be approved by the Qatar Central Bank and the shareholders in the general assembly.
'The bank posted 8.9% growth in core operating income and 1.3% growth in net profit. NIM management was efficient as the benefits of asset re-pricing and loan growth more than offset the increased funding cost, Ahli Bank chairman and managing director Sheikh Faisal bin Abdul-Aziz bin Jassem al-Thani said.
The bank's balance sheet expanded 4.5% to QR39.88bn on the back of growth in loans and advances and investment securities.
Liquid assets as a percentage to total assets stood at a healthy 25.8% in December 2017, a bank spokesman said.
Total funding grew 4.3% to QR33.79bn at the end of December 31, 2017. The funding growth was primarily driven by a 100% growth in debt securities (euro medium term note, or EMTN) to QR3.62bn and a 16.2% growth in other borrowings to QR2.19bn in December 2017, consisting of funding generated through medium term loans.
'The bank's stable funding as a percentage of total funding increased to 16.8% against 11.6% in December 2016. Growth in stable funding was driven mainly by the successful completion of $500mn EMTN Tranche II in international debt capital markets in Q1 (first quarter) 2017 and an increase in medium term loans in Q2 (second quarter) 2017, Sheikh Faisal said.
Total customer deposits increased 6.6% (as against June 2017) to QR23.57bn despite challenging market conditions. However, deposits fell 5.8% year-on-year as it focused on improving stable funding and maturity profile through EMTN Tranche II issue during Q1, 2017 and additional medium term loans in the subsequent quarter.
Total operating income increased 8.9% to QR1.04bn on account of higher net interest income as higher loan balances and asset re-pricing more than offset the increased funding cost.
The lender's cost-to-income ratio for 2017 improved to 30.6%, reflecting efficient management of operating expenses.
Ahli Bank's return on average assets and return on average equity stood solid at 1.7% and 12.6% respectively, despite an increase in balance sheet size and equity base.
Non-performing loans (NPL) ratio stood at 0.99% as on December 31, 2017, reflecting strong asset quality. Loan loss provisions were sufficient to cover 143% of NPLs, it said.
'Our strategy continues to prioritise asset quality, stability ad return over volume growth, Sheikh Faisal said.
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