Doha Bank CEO sees 2016 tough on global econ­omy

The Pak Banker - - COMPANIES/BOSS -

Doha Bank ex­pects 2016 to be a tough year as global eco­nomic con­di­tions im­pact on its per­for­mance, the chief ex­ec­u­tive said on Mon­day, af­ter Qatar's fourth-largest len­der by as­sets re­ported a 6.1 per­cent rise in fourth-quar­ter net profit.

Global mar­kets have ex­pe­ri­enced a tur­bu­lent start to 2016, with oil prices -- a ma­jor fac­tor in Gulf economies -- hit­ting a 12-year low on fears of a con­tin­u­ing glut in the com­mod­ity. Gulf banks' prof­itabil­ity has re­mained fairly re­silient so far in the lat­est earn­ings sea­son, with Qatar Na­tional Bank and a num­ber of Saudi lenders re­port­ing higher earn­ings, al­though there have been pres­sures on liq­uid­ity in the lat­ter half of last year as gov­ern­ments with­drew cash from the bank­ing sys­tem to help plug gaps in their bud­gets. The im­pact is ex­pected to be more pro­nounced in this year's earn­ings, ac­cord­ing to R. Seethara­man, chief ex­ec­u­tive of Doha Bank.

"We have grown 20-30 per­cent in the past but this year is not go­ing to be ex­po­nen­tial, no way," he told re­porters at a press con­fer­ence to an­nounce its 2015 re­sults. "With the cur­rent set of chal­lenges, com­modi­ties fall­ing, cur­ren­cies bot­tom­ing out, it's go­ing to be tough."

Seethara­man added that the bank was still plan­ning to raise its cap­i­tal this year, fol­low­ing on from a De­cem­ber an­nounce­ment about the move, al­though the tim­ing had not been de­cided.

Doha Bank earned a net profit of 232 mil­lion riyals ($63.7 mil­lion) in the three months to Dec. 31 com­pared with 218.7 mil­lion riyals in the same pe­riod of the pre­vi­ous year. Reuters cal­cu­lated the in­crease in quar­terly profit as the bank only gave full-year re­sults for 2015, with­out a quar­terly break­down.

Four an­a­lysts polled by Reuters had fore­cast on av­er­age the bank would make a quar­terly net profit of 258.7 mil­lion riyals. Doha Bank made a profit of 1.374 bil­lion riyals in 2015, ac­cord­ing to a state­ment, up from 1.359 bil­lion riyals in the pre­vi­ous year. The bank's state­ment added that its board was rec­om­mend­ing a cash div­i­dend of 3 riyals per share for 2015, below the 4 riyals per share pay­out for 2014.

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