(MENAFN- The Peninsula) The Peninsula
Doha: Al Khalij Commercial Bank (al khaliji) yesterday announced its financial results for the year ended December 31, 2019, reporting a net profit of QR646m, and registering a year-on-year growth of 6 percent. The bank's net operating income increased by 3 percent to QR1.17bn compared to 2018. Operating expenses remained flat at QR329m, resulting in a cost/income ratio of 27.9 percent. While loans and deposits increased by 3 percent and 6.8 percent quarter-on-quarter, the bank's capital adequacy ratio at year-end stood at a healthy 19.1 percent.
The Board of Directors of al khaliji approved the results, which are subject to Qatar Central Bank's (QCB) approval and endorsement by shareholders at the bank's Annual General Assembly, during a meeting conducted in Doha yesterday. After reviewing the audited financials, the Board has recommended (subject to QCB approval) to the Annual General Assembly the distribution of a cash dividend of 7.5 percent of the nominal share value (QR0.075 per share).
Commenting on the solid results, al khaliji's Chairman and Managing Director Sheikh Hamad bin Faisal bin Thani Al Thani, said: 'al khaliji ended 2019 on a firm footing, delivering increased profitability of QR646m. These results are in line with our vision of steady growth, and we have delivered them through the excellent dedication, integrity and hard work of our staff. Qatar emerged stronger during 2019, playing host to a number of local and international initiatives and events, and has reaped the economic benefits of the same. The government has announced a progressive budget for 2020, with QR90bn announced for major projects including infrastructure. This will continue to create opportunities in the economy. We remain confident of our active participation in the local economy, and monetising opportunities to deliver better value for all stakeholders of the bank.
Fahad Al Khalifa, al khaliji's Group Chief Executive Officer said: '2019 was yet again a positive year for al khaliji. The bank delivered QR646m in profits, which is 6 percent better than our performance last year. We have delivered these results by increasing operating income by improving margins, maintaining an efficient cost base, strengthening our capital and funding positions. Our full year results reflect our continued focus on growing our business locally in Qatar, selectively pursuing opportunities in the local economy.
Net operating income grew by 3 percent year-on-year driven primarily by an increase of 7 percent in net interest income. While we focused on improving operating income, we also continued our focus on maintaining an efficient cost base. Operating costs remained similar to 2018 levels, at QR329m. Prudent management of our loan book has resulted in impairment charges being lower by 7 percent compared to last year. We will continue to focus on maintaining asset quality during 2020 as well.
He added that the bank will remain progressive in building its balance sheet, with quarter on quarter growth in both loans and deposits of 3 percent and 6.8 percent respectively. At the same time, the bank's balance sheet remains strong and liquid with 27 percent of total assets comprising of cash and high quality investment securities, and capital adequacy ratio standing at a robust at 19.1 percent.
'During 2019, both Moody's and Fitch re-affirmed their ratings of ‘A3/Stable' and ‘A/Stable Outlook' noting our good asset quality, and strong capitalisation liquidity positions. In line with our vision and mission, we remained active within the community this year as well, ensuring our participation by sponsoring or hosting charitable, educational and social events. Similar to previous years, we were also proud to be recognised by the industry, some of which were ‘Best Corporate Bank-Qatar' and ‘Best Financial Inclusion Program-MENA' by the European Magazine, ‘Excellence in Private Banking in Qatar' by World Union of Arab Banks, and ‘Best Partner Bank' by the Qatar Development Bank (QDB). The World Bank forecasts economic growth averaging 2.5 percent for Qatar for the period 2020-2022.
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