Jan 18, 2021 by Qanect
His Excellency, Sheikh Jassim Bin Hamad Bin Jassim Bin Jaber Al Thani, Chairman of Qatar Islamic Bank (QIB) has announced that QIB has achieved net profit attributable to shareholders of QAR 3,065 Million for the fiscal year 2020 compared to QAR 3,055 Million for the year 2019, despite the impact of Covid-19 and the decline in oil prices. The Bank maintained the basic earnings per share at QAR 1.21.
QIB Board of Directors proposed a dividend distribution to shareholders of QAR 0.40 per share i.e. 40% of the nominal share value, subject to approval of Qatar Central Bank and QIB’s General Assembly.
Total Assets of the Bank has increased by 6.6% compared to 2019 and now stands at QAR 174.4 Billion driven by a growth in the core banking activities. Financing activities registered a robust growth by 4.7% over 2019 to reach QAR 119.1 Billion. Customer Deposits of the Bank now stand at QAR 118.1 Billion registering a growth by 5.8% compared to December 2019. The Bank’s strong liquidity position in the current challenging environment is reflected in a healthy Financing to Deposit ratio of 101% and execution of new Sukuk issuances for USD 1.65 Bln in 2020. QIB became the first Bank ever, globally, to access the Formosa market in the Islamic format through issuance of US$800 Million of Sukuk listed on the Taipei Stock Exchange.
Total Income for the year ended 31 December 2020 reached QAR 8 Billion registering 2.8% growth compared to QAR 7.7 Billion in 2019, despite sharp drop in global interest rates and the support provided to the customers impacted by Covid-19 pandemic. Income from financing and investing activities has grown by 3.4% to reach QAR 7.2 Billion at the end of 2020 compared to QAR 6.9 Billion for 2019, reflecting a healthy growth in the Bank’s core operating activities.
Total general and administrative expenses of QAR 1.09 Billion for the year ended 31 December 2020 were contained 1% below the year ended 31 December 2019. Strict cost controls supporting higher operating revenues further improved the Bank’s efficiency, bringing down the cost-to-income ratio to 20.1% for 2020, which is the lowest in the Qatari Banking sector.
QIB was able to manage the ratio of non-performing financing assets to total financing assets at 1.4 %, one of the lowest in the industry, reflecting the quality of the Bank’s financing assets portfolio and its effective risk management framework. Given the uncertainties related to long-term impact of the pandemic on various business segments and geographies in which the clients operate, the Bank created precautionary impairment charge on financing assets for QAR 1.26 Billion in the year ended 31 December 2020, which is more than double the amount set aside in the previous year. QIB continues to pursue the conservative impairment policy maintaining a healthy 92% coverage ratio for non-performing financing assets as of December 2020. The Bank continues to take necessary actions and precautions for safety and well-being of its employees, customers and to the community at large.
Total Shareholders’ Equity of the Bank reached QAR 18.3 Billion, an increase of 6.8% as compared to December 2019. As of December 2020 the Total Capital adequacy of the Bank under Basel III guidelines is 19.4%, well above the regulatory minimum requirements prescribed by Qatar Central Bank and Basel Committee.
“2020 was a year of unprecedented challenges for almost every individual and organization across the globe disrupting the way we live and conduct our business. Despite strong headwinds, QIB has maintained strong and steady financial performance, ensured business continuity and continues to support all our customers to efficiently manage their banking and funding requirements. I am pleased with the way we have addressed the challenges while keeping safety and security of our staff, customers and community as our utmost priority. Digital Banking has been a core pillar of our business strategy and the infrastructure built over the last few years enabled us to quickly introduce even more digital banking solutions that allowed all our customers to bank with us remotely 24/7 and to fulfill all their banking needs during these extraordinary times.” said His Excellency Sheikh Jassim Bin Hamad Bin Jassim bin Jaber Al Thani, QIB Chairman.
“This year’s financial results confirm the Bank’s strong foundation and reflect the firmness, resilience and stability of the Qatari banking sector and the national economy. Our sustainable and stable business model has been recognized through our credit ratings from all the international rating agencies and translated into numerous recognitions and awards by the most credible international financial publications”, he added.
“As we enter into the new fiscal year, we have affirmed our position as the leading Islamic Bank while maintaining the position as the second largest Bank in the country. QIB today has the means, resources and qualifications to continue delivering premium banking services to all QIB customers. We are dedicated to delivering value to all our stakeholders and offering our customers modern, convenient and timely banking solutions”, said Sheikh Jassim.
“The Bank’s future development plans are in line with the Qatar National Vision 2030. QIB is committed to support the diversification of Qatar’s local economy and the development of its strong private sector. We remain focused on continuously enhancing our technology platforms to preempt and satisfy the changing client needs in the digital era, improve our level of services and continue helping our customers and partners succeed”, he added.
Sheikh Jassim concluded the Board meeting by expressing his profound gratitude to QIB’s shareholders and customers for their trust in the Bank, and his appreciation to the Board of Directors and all Bank employees for their contribution and continuous efforts towards achieving positive results and continuous improvements”.
In November 2020, Standard & Poor’s (S&P) affirmed the Bank’s credit rating at ‘A-’, Fitch Ratings affirmed Qatar Islamic Bank at ‘A’ and Moody’s Investors Service, (“Moody’s”) has also affirmed the Long-term deposit ratings of QIB at “A1”. In May 2020, Capital Intelligence Ratings (CI) has affirmed the Bank’s Long-term Currency Rating (LTCR) of ‘A+’. In the backdrop of challenging economic conditions due to the ongoing pandemic, affirmation of the rating by all the rating agencies with a stable outlook is a reflection of Bank's adequate capital buffers, good profitability, relatively conservative management, limited market-funding reliance, supported by its established and growing Islamic banking franchise
In 2020, QIB has received more than 30 prestigious awards from well-respected international financial publications. As a testament to its leadership in the financial sector, QIB was awarded the prestigious “Bank of The Year in Qatar 2020” award by Financial Times’ The Banker magazine, and “Best Islamic Bank in the Middle East and Qatar” by The Banker & Global Finance magazines.
QIB was also recognized “Islamic Bank of The Year in Qatar” by The Asset Magazine, EMEA Finance and Islamic Finance News (IFN) and “Best Islamic Retail Bank in the Middle East and Qatar” by The Asian Banker magazine.
As a recognition of his visionary leadership and achievements in the world of banking, Mr. Bassel Gamal, QIB’s Group CEO, received the “Middle East’s Islamic Banker of The Year” award at The Asset Triple A Islamic Finance Awards 2020. He was also awarded “Best CEO Response to COVID-19 in Qatar 2020” award by The Asian Banker, and the “Outstanding Crisis Leadership award” by Global Finance.
QIB was also recognized for its SME centric approach, as the “Best SME Bank in Qatar” by Asiamoney and The Asian Banker and “World’s Best Islamic SME Bank” by Global Finance.
The Bank’s successful digital transformation has significantly improved its customers’ experience and enabled around the clock, remote banking resulting in QIB receiving the “Best Digital Bank award in Qatar” award by six international publications: The Asian Banker, The Asset, Digital Banker, International Business, Global Banking & Finance Review and World Finance. Its state of the art Mobile App was also recognized as the Best by The Asset, World Finance, and “Most Innovative Retail Banking App in MENA Region” by Global Banking & Finance Review.
The Bank was also listed in top reports where QIB was ranked “3rd Strongest Islamic Bank in the World” and “8th Strongest Bank in the Middle East” in The Asian Banker’s 2020 Rankings for the 500 Strongest Banks. QIB has also been named one of the “Top 10 Safest Banks in the Middle East” in 2020 by Global Finance Magazine, and “3rd Safest Islamic Bank in GCC” as part of Global Finance’s annual rankings of the World’s Safest Banks.
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