Qatar Natl Bank posts 29% jump in Q2 profit

Qatar Natl Bank posts 29% jump in Q2 profit

July 7, 2011 9:42 by p.deleon

Qatar National Bank , the Gulf Arab state’s largest lender, posted a 29-percent jump in quarterly profit on Wednesday buoyed by increased lending and customer deposits.

The bank had second-quarter net profit of 1.8 billion riyals ($494.3 million), according to Reuters calculations, compared to 1.4 billion riyals in the same period last year.

QNB reported first-half profit of 3.5 billion riyals in a statement. Reuters calculated the quarterly results based on figures previously given by the bank.

Six analysts forecast, on average, second quarter profit of 1.75 billion riyals, in a Reuters poll.

QNB is the first major regional lender to report earnings and is closely watched for indications of the sector’s performance.

Loans, advances and financing activities rose 28 percent in the six months ended June 30 while customer deposits and unrestricted investment accounts jumped 41 percent.

“Given the government’s focus on developing the physical and social infrastructure with investments valued at about $100 billion between 2010 and 2015, state spending on infrastructure is expected to remain strong and will drive credit growth,” Digvijay Tanwar, analyst at Kuwait’s Global Investment House said in a research note.

“With a 71 percent market share of public sector lending at the end of 2010, QNB will be a key beneficiary.”

QNB is 50-percent owned by sovereign wealth fund Qatar Investment Authority and has been expanding abroad, with operations in Syria, Jordan, the United Arab Emirates and Switzerland.

Banks in Qatar are expected to benefit as the country is one of the world’s fastest growing economies and is set to spend more on infrastructure as it prepares to host the 2022 World Cup.

Shares of QNB closed up 0.5 percent at 144.70 before the results were announced. (By Regan E. Doherty; Reporting by Regan E. Doherty; Editing by Amran Abocar and Jane Merriman)