Commercial Bank of Qatar profit slumps on bad loans
Lower oil prices and troubled oversees assets weigh on bottom line
Commercial Bank of Qatar (CBQ), the Gulf Arab state's third-largest lender by assets, reported a 58.4 per cent slump in second-quarter net profit, missing analysts' forecasts, as provisions for bad loans jumped.
The bank is having to contend with a rise in soured loans at a time when Qatar's banking system remains vulnerable to a regional rift involving the United Arab Emirates, Saudi Arabia, Bahrain and Egypt imposing sanctions on Qatar.
The bank earned a net profit of 88.4 million riyals (US$24.3m) in the three months to June 30, it said in a statement. That compares with a profit of 212.3m Qatari riyals in the same period a year earlier. The average of four analysts polled by Reuters had forecast CBQ would make a quarterly profit of 118.3m riyals.
After launching a five-year plan in November to try to stem a dismal earnings run, chief executive Joseph Abraham said in April that provisions would remain high for the next few quarters.
The bank has struggled with a rise in bad loans due to the economy weakening on lower oil prices, as well as troubles facing some of its overseas investments.
CBQ last year raised its stake in Turkey's Alternatifbank to 100 per cent and also holds shares in National Bank of Oman and United Arab Bank.
Updated: July 19, 2017 12:17 PM