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Qatar Tribune
5 days ago
- Business
- Qatar Tribune
Commercial Bank reports QR1.26 bn net profit for H1 amid strategic growth, global tax impact
Tribune News Network Doha The Commercial Bank, its subsidiaries and associates (Group), on Wednesday announced a net profit of QR1,261.4 million for the first half of 2025, reflecting its continued resilience and commitment to long-term value creation, despite new global tax regulations and marketvolatility. The Group reported a net profit before the application of the new BEPS Pillar Two tax at QR1,374.2 million for the six months ended 30 June 2025, down 12.5 percent from QR1,571 million during the same period in 2024. The decline was primarily attributed to increased losses from its Turkish subsidiary, Alternatif Bank, which widened by QR104.2 million, and changes related to long-term incentive schemes (LTIS), amounting to QR35.9 million. Adjusting for LTIS, the normalised net profit before tax stood at QR1,410.1 million. With the implementation of the 15 percent global minimum top-up tax under the OECD's Base Erosion and Profit Shifting (BEPS) Pillar Two framework, the Group incurred a tax charge of QR112.9 million. Consequently, the net profit after tax declined to QR1,261.4 million in H1 2025, compared to QR1,571 million in H1 2024. Commercial Bank Chairman Sheikh Abdulla bin Ali bin Jabor Al Thani said the bank had made significant progress on its five-year strategic plan (2022–2026), especially in digital innovation, client experience, and operational efficiency. 'As we approach the final stretch of our strategy, our focus remains on disciplined execution, delivering sustainable value, and aligning with Qatar National Vision 2030,' he said. Vice Chairman and Managing Director Omar Hussain Alfardan highlighted the reaffirmation of the bank's credit ratings and a share buyback plan as testaments to investor confidence and the bank's robust fundamentals. 'The Board approved a share buyback plan of up to 10 percent of issued shares in May 2025, subject to regulatory approval. This aligns with our strategic goal of enhancing shareholder value and capital efficiency,' he said. In June, the bank successfully issued a QR500 million senior unsecured bond under its EMTN programme, further diversifying its funding base. The period also saw the launch of a new corporate mobile banking app, which earned the 'Best Mobile Banking App – Qatar 2025' award from International Finance. Commercial Bank Group CEO Joseph Abraham said the bank's performance in H1 2025 was driven by a strategic focus on diversified income sources, with total assets growing 13.2 percent year-on-year to QR182.1 billion. 'Our non-interest income grew 1.9 percent year-on-year, led by higher fee and commission-based income across transaction banking, cards, wealth management, and investments,' Abraham said. Loans and advances to customers rose by 12.7 percent to QR103.8 billion, supported by growth in the corporate, government, and retail sectors. Investment securities increased by 26 percent to QR35.8 billion, with the bank locking in yields through high-quality investments. Customer deposits reached QR83.5 billion, with low-cost deposits growing 10.2 percent and now constituting 42.1 percent of the deposit mix. Debt securities increased to QR11.4 billion, underscoring efforts to diversify funding. Net provisions declined by 30.8 percent to QR244.1 million, reflecting recoveries and reversals. The ratio of non-performing loans to gross loans improved to 5.5 percent from 5.9 percent a year earlier, while the loan coverage ratio stood at a healthy 87.9 percent. Alternatif Bank, the Group's Turkish subsidiary, reported a loss of QR107.1 million, driven by hyperinflationary accounting and market volatility. Despite higher costs from digital innovation and operations in Turkey, the Group maintained a strong capital base. The Common Equity Tier 1 (CET1) ratio was 12.5 percent, while the Capital Adequacy Ratio (CAR) stood at 17.2 percent — both well above Qatar Central Bank and Basel III requirements. From January 1, 2025, the Group began accruing the BEPS Pillar Two tax as per the OECD's Global Anti-Base Erosion (GloBE) rules, which seek to ensure that multinational enterprises are taxed at a minimum effective rate of 15 percent across all jurisdictions. The tax led to an incremental cost of QR112.9 million in the first half of the year. In a move to enhance shareholder returns, the Group's board has approved a share buyback programme of up to 10 percent of fully paid-up issued shares. The programme awaits regulatory approval from Qatar Central Bank (QCB) and Qatar Financial Markets Authority (QFMA). Looking ahead, Abraham said the bank remains committed to executing its strategic priorities while continuing to support Qatar's sustainable development goals. 'We are well positioned to adapt, innovate, and grow in a dynamic environment. Our performance in H1 2025 reflects strong fundamentals, prudent capital management, and a clear roadmap for long-term value creation,' heconcluded.
Zawya
17-04-2025
- Business
- Zawya
Qatar: Commercial Bank reports $179mln net profit after tax for Q1 2025
Doha, Qatar: The Commercial Bank, its subsidiaries and associates announced yesterday its financial results for the three months ended March 31, 2025. The Group reported a net profit before Pillar Two Tax of QR704.3m for the three months ended March 31, 2025 as compared to QR801.6m for Q1 2024. The 12% variance was due to the increased losses of QR31.9m from Alternatif Bank in Q1 2025 as compared to the previous year and due to long-term incentive scheme (LTIS) related changes of QR84.8m. If normalized for the LTIS related changes, the adjusted net profit before tax for Q1 2025 would be lower by QR12.5m which equates a 1.7% decrease. Due to the likely implementation of the Global Minimum Tax of 15% (Base Erosion and Profit Shifting - BEPS Pillar Two Tax), a tax charge of QR52.9m was deducted. Overall, these items resulted in a decrease in reported net profit after tax of 18.7% compared to QR801.6m in the same period last year. Commercial Bank held its Annual and Extraordinary General Meetings on 20 March 2025, during which shareholders approved all agenda items, including the Board's recommendation to distribute a cash dividend of QR0.30 per share. Sheikh Abdulla bin Ali bin Jabor Al Thani, Chairman, said, 'Commercial Bank continues to make strong progress towards our vision of becoming Qatar's leading bank, delivering the world's best client experience through innovation and digital excellence. Now in the fourth year of our five-year strategic plan (2022–2026), we remain focused on disciplined execution and long-term value creation, and strive to improve our performance in the coming months. As we build on the foundations laid over the past three years, we are fully aligned with Qatar National Vision 2030 and committed to supporting the nation's growth while delivering exceptional service and sustainable returns to our customers and shareholders.' Hussain Alfardan, Vice Chairman, said, 'As we celebrate 50 years of banking excellence and digital innovation, Commercial Bank remains focused on driving forward-looking initiatives that support Qatar's national ambitions and deliver lasting value. In the first quarter of 2025, we took another meaningful step by collaborating with Citi to become the first bank in Qatar to offer 24/7 USD Cross Border Transfers. This milestone enhances the speed, flexibility, and convenience of international transactions for our clients, reflecting our continued investment in cutting-edge digital solutions. It also underscores our role as a trusted enabler of Qatar's vision to be a global leader in both finance and technology.' Joseph Abraham, Group Chief Executive Officer, commented, 'Commercial Bank delivered a resilient performance in the first quarter of 2025, reflecting disciplined execution of our strategy and a continued focus on long-term value creation. The Bank reported a consolidated net profit after tax of QR651.4m, driven by strong growth in fee and other income, improved contribution from associates, and lower net provisions. Our strategic focus on diversifying income streams continues to yield results, with total fee and other income increasing year-on-year, supported by robust performance in transaction banking, growing cards portfolio, and enhanced wealth management. This helped offset pressure on net interest income to an extent, which was impacted from a downwards interest rate revisions. Meanwhile, our subsidiary in Turkey, Alternatif Bank, reported a loss of QR31.9m, primarily reflecting the impact of hyperinflationary accounting and market volatility. We remain focused on optimising the balance sheet, achieving a 1.7% increase in total assets. Further, we continue to grow our low-cost deposits, which increased by 5.7% year on year, reflecting our efforts to diversify funding sources and strengthen balance sheet resilience. Our capital position remains robust, with a CET1 ratio of 12.3% and a Capital Adequacy Ratio of 17.1% as we continue to support growth while maintaining prudent capital levels in line with our guidance. Looking ahead, we are committed to delivering value for our stakeholders by executing on our strategic priorities, advancing sustainable finance, and supporting Qatar's National Vision 2030. Our performance in first quarter 2025 reinforces our ability to adapt, innovate, and grow in a dynamic regional and global environment.' Total assets as at 31 March 2025 reached QR169.1bn, an increase of 1.7% from 31 March 2024. This is mainly driven by an increase in loans and advances to customers and an increase in investment securities by 23.5% to reach QR34.7bn, with the Bank investing in high-quality market securities. The loans and advances to customers increased to QR94.9bn, up by 5.8% due to higher government & public sector borrowings. Debt securities rose to QR10.5bn as the Bank diversified its funding sources. Furthermore, customer deposits is at QR76.4bn as we have strategically reduced high cost funding, while growing low-cost deposits by 5.7%, which represents 41.0% of the total customer deposits mix. © Dar Al Sharq Press, Printing and Distribution. All Rights Reserved. Provided by SyndiGate Media Inc. ( The Peninsula Newspaper
