Analysts hails performance as bank increased its lending in Qatar's booming economy
Qatar National Bank (QNB), the Gulf Arab state's largest lender, reported a jump in quarterly profit on Wednesday, as it increased lending in Qatar's booming economy.
The bank's third-quarter net profit rose 27 percent to QR1.9bn ($521m), according to Reuters calculations.
QNB reported a nine-month net profit of QR5.4bn for the period ended Sept 30. It did not provide figures for the third quarter.
Loans, advances and financing activities rose 43.9 percent at the end of September from a year earlier. Customer deposits jumped 31.4 percent.
"Their growth is strong, the liquidity profile is very solid, and their return on weighted assets is the second highest in MENA," said Japp Meijer, senior analyst at AlembicHC in Dubai.
"From every angle, the performance is phenomenal."
QNB is the first major regional lender to report earnings and is closely watched for indications of the sector's performance.
The bank boosted salaries for Qatari employees by 60 percent, in line with a recent move by the state's government, two sources familiar with the matter said last week.
In September the Qatari government hiked salaries, pensions and benefits for its state and military employees by 60 percent, in a move seen as an attempt to help preserve stability in the state.
Meijer said he did not anticipate the salary increase to weigh heavily on the lender's fourth-quarter earnings.
"It might be a few percentage points lower, but nothing drastic," he said.
QNB is 50-percent owned by sovereign wealth fund Qatar Investment Authority and has been expanding abroad, with operations in Syria, Jordan, the UAE and Switzerland.
Banks in Qatar are expected to benefit as the country is one of the world's fastest growing economies - GDP grew as much as 41.8 percent in the second quarter - and is set to spend more on infrastructure as it prepares to host the 2022 World Cup.
Shares in QNB are up 5 percent so far this year. They closed at QR139.5 on the Doha exchange Wednesday.