Qatari banks boosted net earnings by nearly 25 per cent in 2010 as domestic credit defied a general slowdown in the oil-rich Gulf and surged by about 16 per cent, according to the banks’ balance sheets.
The combined assets of the nine listed banks also swelled by nearly 19 per cent to a record high level at the end of 2010 after a sharp rise in deposits with the banks, showed the statements, published by the Union of Arab Banks (UAB).
From around QR2.8 billion ($767 million) in 2009, the consolidated net profits of the nine banks soared to nearly QR3.51 billion ($961 million) last year, the Beirut-based UAB said in its monthly bulletin.
Qatar National Bank (QNB), the Gulf country’s largest bank, recorded the highest net income in 2010, when it stood at QR1,567 million ($429 million), an increase of nearly 35.7 per cent over the 2009 profits of QR1,154 million ($316 million).
It was followed by the Commercial Bank of Qatar (CBQ), which boosted earnings to QR449 million from QR419 million. Profits of Qatar Islamic Bank edged up slightly to QR367 million from QR363 million in the same period.
All other banks recorded higher earnings, which grew to QR290 million from QR267 million for Doha Bank, to QR33 million from QR242 million for Rayan Bank, to QR125 million from QR94 million for Qatar International Bank, to QR117 million from QR46 million for Gulf Commercial Bank, to QR154 million from QR140 million for the Qatar International Islamic Bank and to around QR113 million from QR83 million for Alahli Bank.
The report showed the high profits, which are in contrast with the sharp slowdown in earning growth in other Gulf oil exporters, followed a large increase in domestic credit as banks benefited from high GDP growth and massive public expenditure on infrastructure and other projects.
From around QR68.9 billion ($18.8 billion) in 2009, total domestic credit grew by nearly 16 per cent to QR79.9 billion ($21.9 billion) in 2010.
Nearly 45 per cent of the loans were extended by QNB as they totalled about QR36.2 billion at the end of 2010 compared with QR29.8 billion at the end of 2009. Credit provided by CBQ rose to QR9.2 billion from QR8.7 billion.
The report showed the combined assets of the nine banks swelled by nearly 19 per cent to a record high level of QR137.4 billion ($37.6 billion) at the end of 2010 from QR115.8 billion ($31.7 billion) at the end of 2009.
QNB controlled around QR61.3 billion in assets at the end of 2010, accounting for nearly 44 per cent of the total bank assets.
The report showed the surge in assets was a result of a steep rise in deposits, which leaped by 27.7 per cent to QR82.7 billion from QR72.4 billion.
Unlike neighbouring Gulf countries, Qatar’s economic and financial sector was less affected by the global fiscal crisis and regional debt default problems because of a rapid increase in its LNG exports.
Early this year, Qatar said it had completed LNG projects to pump 77 million tonnes of LNG per year from its gigantic 6,000-square-km offshore North Field, the world’s largest gas reservoir with deposits of over 25 trillion cubic metres.
The surge in LNG exports over the past few years allowed Qatar to record one of the highest economic growth rates in the world and turned the tiny Gulf country into one of the richest nations in terms of GDP per capita.
The country’s real GDP galloped by around 16 per cent in 2010 and is expected to pick up by more than 19 per cent in 2011, according to private forecasts.
Growth in 2010 was far above the 8.7 per cent rate recorded in 2009, when oil prices plunged by nearly $30 a barrel over the previous year, the Saudi American Bank Group (SAMBA) said in a recent study.
In nominal terms, Qatar’s GDP leaped by 24.5 per cent in 2010 and is projected to swell by 22.4 per cent this year because of higher oil prices and LNG output. SAMBA put the nominal GDP at $122.3 billion in 2010 and $149.7 billion in 2011.
“Qatar’s economy continues to thrive as growing hydrocarbon revenues support robust public spending which has helped revive private sector activity. The hydrocarbons sector continued to lead the way growing by nearly 36 per cent in the third quarter on the back of higher oil prices and production,” it said.