NBK reports Q1 net profits of KD78.9m

Manama : National Bank of Kuwait (NBK) reported net profits of KD78.9 million (US$262m) for the first quarter of 2016 compared with KD96.5m (US$320m) for the same period in 2015. Adjusting for gains recognised in 1Q 2015 from the sale of NBK’s 30 per cent stake in International Bank of Qatar (IBQ), net profits recorded a growth of 6.7pc year on year. 

Net operating income grew at 7.6pc year on year to reach KD179.2m (US$594m) after adjusting for the sale of NBK’s stake in IBQ.

Total assets as of end of March 2016 reached KD 24.7 billion (USD81.7bn) up 5.8pc compared to end of March 2015, while total shareholders’ equity increased by 1.7pc to KD2.6bn (US$8.8bn). Customer loans and advances reached KD13.6bn (US$44.9bn) as of end of March 2016, growing at 9.6pc year-on-year, while customer deposits grew by 4.9pc for the same period to reach KD12.3bn (US$40.6bn).

NBK asset quality remained exceptionally strong with NPLs/Gross loans improving to 1.32pc as of end of March 2016 from 1.47pc a year ago, and NPL coverage increasing to 335pc from 281pc in March 2015.

Provision charges remained relatively high in 1Q 2016 resulting mainly from additional precautionary provisions in light of the ongoing uncertainty in global economic outlook and as oil prices remain under pressure.

Nasser Al-Sayer, NBK Chairman, said, “The strong set of results in 1Q 2016 are driven mainly by the solid growth of the core banking activities. Adjusting for the exceptional gains from the sale of IBQ, NBK’s net operating income grew at 7.6pc year-on-year to KD179.2m (US$594.0m) confirming the Bank’s strong position to seize growth opportunities locally and regionally. 

Isam Al Sager, NBK’s Group Chief Executive Officer said, “At the local level, NBK continues to defend its market share, achieving growth across all business lines. Moreover, NBK continues to reap the benefits from its acquisition of 58.4pc of Boubyan Bank in 2012. Boubyan Bank has achieved strong growth and high performance since its acquisition increasing its market share year on year.” 

Al Sager also added that the performance of NBK’s international operations remains very lucrative despite the challenges that came with lower oil prices and uncertainty in global economic outlook. NBK Group generated 28.3pc of the year’s profits from its branches, associates and subsidiaries outside Kuwait affirming the banks’ successful strategy of regional and international diversification.

It is worth mentioning that during 1Q 2016 NBK’s General Assembly approved increasing the bank’s authorized capital to KD600m. More recently, the Board of Directors approved increasing the bank’s issued and paid-in capital by 6.5pc through a rights issue, issuing 344m shares priced at 400 fils per share (a nominal value of 100 fils/share in addition to a premium of 300 fils/share).