NBK reports net profits of USD 321.5 million for 1Q 2015

Press release

Published April 15th, 2015 - 04:49 GMT

Al Bawaba

National Bank of Kuwait (NBK) reported net profits of USD 321.5 million (KD 96.5 million) for the first quarter of 2015 compared with USD 279.6 million (KD 83.9 million) for the same period in 2014, growing 15% year-on-year.

It is worth mentioning that the Group’s 1Q 2015 net profits included a post-tax impact of KD 22.5 million (USD 75 million) from the sale of NBK’s 30% stake in IBQ. Additionally, NBK increased its provision charges in 1Q 2015 compared to the same period last year on the group level which also included judgmental provisions.

Total assets as of end of March 2015 reached USD 77.7 billion (KD 23.3 billion) up 13.8% compared to March 2014, while total shareholders’ equity increased by 5.3% to USD 8.7 billion (KD 2.6 billion). Customer loans and advances reached USD 41.2 billion (KD 12.4 billion) as of end of March 2015, growing at 12.9% year-on-year, while customer deposits grew by 5.1% for the same period to reach USD 38.9 billion (KD 11.7 billion).

NBK asset quality remained exceptionally strong with NPLs/Gross loans improving to 1.47% as of end of March 2015 from 1.93% a year ago, and NPL coverage increasing to 281% from 203% a year ago.

Nasser Al-Sayer, NBK Chairman, said “NBK continued delivering solid growth and performance. This reflects NBK’s strong financial position, conservative management and the bank’s successful strategy”.

Al-Sayer affirmed that the solid results of 1Q 2015 are driven by the strong growth of the core banking activities. During 1Q 2015, net operating income grew at 22.8% year-on-year to USD 648 million (KD 194.5 million) confirming NBK’s strong domestic and regional market position.

“There is a noticeable improvement in the process of tendering, award and execution of the large infrastructure projects, which has reflected positively on NBK’s operational income and loan portfolio. NBK continues to play an important role in the financing of mega projects.”

“The economic outlook for Kuwait and the GCC remains positive despite the sharp drop in oil prices due to the huge reserves and solid financial positions. This supports the capital expenditure plans and the continuity of development projects that Kuwait and the GCC have embarked upon.” Al-Sayer added.

Isam Al-Sager, NBK’s Group Chief Executive Officer reaffirmed NBK’s strategic direction as a leading bank in Kuwait and the region with the aim of further diversifying its income sources. “In Kuwait, the bank continued to strengthen its market position, while the acquisition of 58.4% stake in Boubyan Bank in 2012, remains a differentiator to NBK’s operations in Kuwait as Boubyan continues to offer strong growth outlook for the Group.”

“Regionally, NBK is in a strong position to benefit from growth opportunities in regional markets especially the GCC. The reputation and experience in leading the financing of mega deals made NBK the bank of choice for regional and international companies operating in the region in parallel to the Bank’s presence across continents in more than 15 markets.” Al-Sager highlighted.

“The Egyptian market’s positive outlook represents a significant growth potential for the Group. NBK seeks to strengthen its position in the Egyptian market on the back of positive developments in terms of security level and political environment”, Al-Sager added.

April 2015 saw another achievement for NBK with the successful issuance of USD 700 million additional Tier 1 securities at a relatively low rate of 5.75% which is considered among the lowest for global institutions considering the current environment. The issuance of the securities attracted significant interest from fixed income investors around the world as the issuance has seen two times coverage in a record timing of 6 days only. This reflects the confidence that investors have in NBK. The securities issuance is the first in the Middle East and North Africa (MENA) region that is rated and carries an investment grade rating from one of the international rating agencies.

NBK continues to enjoy collectively the highest ratings among all banks in the Middle East from the three international rating agencies Moody’s, Fitch Ratings and Standard and Poor’s. The Bank’s ratings are supported by its high capitalization, prudent lending policies, and its disciplined approach to risk management, in addition to its highly recognized and very stable management team. NBK was also named among Global Finance’s list of the 50 safest banks in the world for the ninth consecutive time.

NBK enjoys the widest banking presence with a local and international network reaching 4 continents. NBK’s international presence spans many of the world’s leading financial centers including New York, Europe, GCC, Middle East, Singapore as well as China (Shanghai).

Background Information

National Bank of Kuwait

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