The National Bank of Kuwait, the country's biggest publicly traded lender, said third quarter profit advanced 7.3 per cent, boosted by net interest income and income from Islamic financing.
Net income attributable to the shareholders of the bank increased to 73.67 million Kuwaiti dinars (Dh895.4m) in the three months ended September compared to 68.65m dinars in the same period last year. Net interest income and net income from Islamic financing gained 13 per cent to 161.05m dinars in the third quarter compared to 142.8m dinars in the corresponding period last year.
The gains came despite an increase in provision charge for credit and impairment losses and increase in staff expenses. Money set aside to cover bad debt increased to 60.5m dinars in the third quarter versus 41.9m dinars while staff expenses rose to 38.6m in the quarter from 35.5m in the same period last year.
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The Egyptian investment bank EFG-Hermes said that National Bank of Kuwait's earnings missed its expectations of 78.5m dinar profit largely due to higher than expected provisioning though it did not expect that this would be ongoing worry going forward.
"Despite higher provisioning charges in the third quarter of 2017 relative to the quarterly run rate (which is around 45m dinars), credit quality in Kuwait is not a key concern for us with most banks results indicating a general improvement in credit quality over the past two years," Elena Sanchez-Cabezudo and Ahmed El Shazly, analysts at the bank, said in a note.
The bank's nine month net profit increased 8.7 per cent to 238.4 million dinars from 219.3 million in the year earlier period, largely due to a higher net interest income and a gain in earnings from Islamic financing.
Shares of National Bank of Kuwait were trading 0.63 per cent lower at 786 fils as of 12:50 pm in Abu Dhabi.
