Qatar National Bank rules out sale of stake in UAE bank

DUBAI- 11 October 2017:Qatar National Bank’s said on Wednesday its stake in United Arab Emirates-based Commercial Bank International is not for sale.

There has been speculation over QNB’s stake in the UAE bank after other Qatari companies cut some UAE business holdings following a decision by the UAE, Saudi Arabia, Bahrain and Egypt on June 5 to cut diplomatic and transport ties with Qatar.

QNB, the largest lender in the Middle East and Africa by assets, holds a 40 percent stake in Abu Dhabi-listed CBI. The stake is valued at around $155 million, according to Reuters’ calculations.

Doha Bank, Qatar’s fifth-biggest bank, is in talks to sell some of its UAE assets, Reuters reported last month.

Commercial Bank of Qatar, Qatar’s third largest lender by assets, is in talks to sell its 40 percent stake in Abu Dhabi-listed United Arab Bank to the UAE’s Tabarak Investment, sources told Reuters last month.

QNB earlier on Wednesday reported a net profit of 3.60 billion riyals ($989 million) for the three months to Sept. 30, 5.6 percent up from 3.41 billion riyals in the year ago period.

That was above EFG Hermes’ forecast of 3.46 billion riyals and a SICO Bahrain forecast of 3.51 billion.

Qatar’s banking sector is facing the fallout from a decision by Saudi Arabia, the United Arab Emirates, Bahrain and Egypt on June 5 to cut diplomatic and transport ties with Qatar, a move that has cut off many of Qatari banks’ funding sources in the Gulf.

The regional rift resulted in some other Qatari banks seeing an initial drop in deposits, while many are now likely to face higher borrowing costs.

QNB’s net interest income slipped by 1.9 percent in the quarter to 4.63 billion riyals. The bank said a 3 percent fall in its net interest income for the nine month period was primarily driven by the devaluation of the Egyptian pound in late 2016.

QNB, which has a presence in more than 31 countries and is the largest bank in the Middle East and Africa by assets, brought Societe Generale’s Egyptian business for $2 billion in 2013.

For the first nine months of the year, QNB reported a net profit of 10.3 billion riyals, up 6 percent.

QNB’s customer deposits reached 574.32 billion riyals at the end of September, up from 500.52 billion riyals in the same period of last year. ($1 = 3.6400 Qatar riyals)