Qatar First Bank L.L.C. (Public) “QFB”, a leading Shari’ah compliant bank based in Qatar, regulated by QFCRA and listed on the Qatar Stock Exchange (QSE), has released its financial results for the year ended 31 December 2019.
A key highlight for the year was that accumulated losses of QAR 1.3 billion were offset against share capital during the year. As result of offset and performance during the year, the Bank was able to secure positive retained earnings of QAR 2.9 million as at 31 December 2019. Additionally, QFB reported its second consecutive profitable quarter in Q4 with a net profit of QAR 1.3 million attributable to equity holders of the bank. QFB also recorded a growth momentum related to its income streams where fee income increased by 103% to 32.3 million compared to QAR 15.9 million in 2018 largely driven by new structured products introduced during 2019. QFB made continuous gain from its cost rationalization plan implemented in 2017 where bank reduced its total expenses by 17.2% compared to 2018.
Sheikh Faisal bin Thani Al-Thani, QFB Chairman, commented:
“2019 was a key milestone for QFB where three of our quarters ended up generating net profit, and our fee income products showing significant growth with the successful execution of the fee-based-income model. These optimistic signs has helped us to create the turnaround performance in 2019 along with the unending confidence from our shareholders while we are looking forward to a stable growth momentum in 2020”
It is noteworthy that QFB has made a prodigious curtain raiser for 2019 where shareholders elected a robust well-diversified new board of directors consists of prominent economic and business figures that abetting the current transformational shift of QFB. QFB also shifted its operating model to a fee income on structured products.
In line with this new strategy, the bank announced earlier that it has successfully completed the $117 million off-market acquisition of 90 North office campus located in Bellevue, Washington. This acquisition was QFB’s 6th product offerings and 4th in the US real estate market offering investors access to international investment opportunities through Investment Management Platform. It was also a strong testimony of QFB’s key focus on its strategy of offering innovative financial solutions with greater returns to the bank’s clients of high net worth Individuals, institutional investors and government related entities. The product offered an investment in a stable mature market. This investment provided clients with ten years of strong, credit-backed contractual cash flows with minimal capital obligations and a best-in-class asset in a market characterized by large, market-leading companies such as Microsoft, T-Mobile, Nintendo, REI, Amazon, Google, Facebook, Oculus, Costco, AT&T, and Boeing.
QFB also made a successful exit along with its investors through the sale of two Boeing 737-900ER aircrafts, which is its second sharia-compliant aviation deal. The two aircrafts were on a 7-year long-term sharia-compliant lease contract to Indonesia’s Lion Air. Interestingly, this is the first deal of its kind that the bank is undertaking in the field of aviation through the global investment management platform that the bank launched and attracts increased opportunities for its clients and investors. Noteworthy this investment product has achieved for its holders a cash dividend of 9% annually, whereby the profits are distributed every three months, while the internal return on investment of the product is about 12%.
As a contingency measure in order to mitigate any future revaluation risks QFB is continuing to liquidate its private equity portfolio through many successful exits during 2019. Proceeds from these exits will be reinvested in more secure assets across politically stable investment options.