Qatar Commercial Bank Q4 net surges 66pc
Doha, January 24, 2011
Commercial Bank of Qatar (CBQ), the Gulf state's second-largest bank by market value, said its fourth-quarter net profit soared 66 per cent, but fell short of forecasts due to higher-than-expected provisions.
The bank posted quarterly net profit of 309 million riyals ($85 million), compared with 186 million riyals a year earlier.
Analysts on average expected the bank to make a quarterly profit of 442 million riyals, according to a Reuters poll. 'It (is) due to high provisions, as we've seen a rise in delinquencies across the sector,' said one analyst who declined to be named.
In the prior-year quarter, CBQ's earnings suffered a 170 million riyal hit related to a corporate default. The bank had a full-year net profit of 1.64 billion riyals, it said in a statement to the Qatar bourse.
CBQ's board recommended a cash dividend of 7 riyals per share. Impairment losses on loans and advances totalled 166.5 million riyals for 2010, while losses on investments were 128 million riyals, it said.
'Provisioning was a little bit disappointing, as was loan growth, with a slight increase in non-performing loans,' said Elena Sanchez, analyst at EFG-Hermes in Dubai.
On Tuesday, CBQ said it received funds from Qatar Investment Authority (QIA), the Gulf state's sovereign wealth fund, after it sold 20.62 million shares to the fund at a price of 78.30 riyals per share.
The sovereign fund is taking up a 10 percent stake in Qatari banks -- the remainder of a planned 20 percent purchase announced during the global financial crisis -- to provide support to its local lenders.
QIA's move is slated to take place in the first quarter and is likely to boost confidence in the sector.
Qatar's central bank issued a 50 billion-riyal ($13.74 billion) three-year bond to local banks last week to raise funds for development projects and to drain excess money from the banking system.
Qatar National Bank, the Gulf state's largest lender by market capitalisation, posted a 40.2 per cent jump in fourth-quarter earnings on Jan. 10, beating analysts' expectations as financing and interest income soared.
Qatar National Bank was the first major regional lender to report earnings and is closely watched for indications of the sector's performance.
CBQ shares closed 2.2 per cent lower on the Qatar bourse on Sunday before the results were announced. The broader index dropped 1.5 per cent.-Reuters