The Banking Executive Magazine - August 2021

Qatari Banks Qatari Banks' H1 Net Profit RETURNS TO PRE-PANDEMIC LEVELS - MOODY'S The net profits of Qatari banks re- turned to pre-pandemic levels in the first half of 2021 despite higher levels of provisioning charges, Moody’s In- vestors Service said in a report. Qatari banks rated by Moody’s had an aggregate net profit of 11.8 bil- lion riyals ($3.2 billion), up 12 per- cent from the year-earlier period and 1 percent higher than in the first half of 2019. “Growth in net profit was consistent across the banks and largely driven by an increase in both net interest and non-interest income”, said Nitish Bhojnagarwala, a Vice President and Senior Credit Officer at Moody’s and author of the report. “Solid capital buffers, the recovery of oil prices and the resolution of Qatar's diplomatic dispute with some of its neighbours will support the banks' full-year performance for the remainder of the year.” Net interest income increased, mainly due to a sharp reduction in interest expenses, due to the low in- terest rate environment. Interest costs fell 16 percent compared with the same period in 2020, more than off- setting the decline in interest income. Total non-interest income rose by 12 percent in the first half of 2021 com- pared with the year-earlier period, re- flecting the removal of a waiver of charges and fees in response to the pandemic that weighed on fees and commission income last year, an in- crease in business volumes and credit growth, and in some cases im- provements in the performance of as- sociates that had been dragging on non-interest income in 2020. the BANKING EXECUTIVE 40 ISSUE 152 AUGUST 2021