Masraf Al Rayan, the leading bank in Qatar and the region, announced today its financial results for the year ended 31 December 2016, delivering a net profit of QAR 2,075 million.
The Board of Directors, at a meeting held on January 16th 2017, recommended a cash dividend distribution of QAR 2 per share, representing 20% of the paid-up capital. The recommendation is subject to the approval of the shareholders, in a General Assembly Meeting which is scheduled to be held on Tuesday 25th April 2017, after obtaining the approval from Qatar Central Bank.
Commenting on the results, His Excellency Dr. Hussain Al Abdulla, the Chairman and Managing Director of Masraf Al Rayan, said; "The results are good given market conditions as 2016 witnessed many events that dominated the economic landscape including the substantial decline of oil prices which led to many countries in the region to adapt more conservative policies and to take strong actions to control public spending in order to mitigate the effects of declining revenues”.
Dr. Al Abdulla emphasized that given described market conditions the Bank focused on protecting its capital, asset quality, performance and operational efficiency indicators. The Bank continues to be one of the leading banks among its peers in terms of strong with capital adequacy ratio at 18.85%, highest asset quality with NPL at 0.16% combined with one of highest operational efficiency indicator with cost-income ratio at 18.09%. As a result, our financial performance ratios also remain one of the best with ROAA and ROAE at 2.37% and 16.77% respectively. Given these strong financial indicators, the Bank has positioned itself among its peers at the top league locally, regionally and globally reflecting our prudent business strategy and conservative risk appetite. We will continue to exert every effort possible to ensure that our objective of enhancing value for our shareholders, customers and other stakeholders remain our priority.
Mr. Adel Mustafawi, Masraf Al Rayan’s Group Chief Executive Officer, reiterated similar views on the announced financial results, pointing to that fact that Masraf Al Rayan's growth in 2016 was limited due to liquidity constraints in the market. As a result the Bank was negatively impacted by the increased cost of deposits and other funding sources. Despite these circumstances the bank's financial position and performance continues to be strong as presented below:
- Total assets reached QAR 91,531 Millioncompared to QAR 83,331 Million as of December 31 2015, a growth of 9.8%.
- Financing activities increased to QAR 67,635 Million, compared to QAR 62,567 Million as of December 31 2015, a growth of 8.1%.
- Investment reached QAR 14,521 million as of December 31 2016.
- Customers' Deposits increased to reach QAR 58,024 Million, compared to QAR 55,623 million as of December 31 2015, a growth by 4.3%.
- Shareholders’ Equity, before distribution, reached QAR 12,705 Million compared to QAR 12,044 Million as of December 31 2015, a growth of 5.5%.
In August 2016, Moody's Investors Service, upgraded Masraf Al Rayan's (MAR) long term issuer ratings to A1 from A2 and Counterparty Risk (CR) Assessment to Aa3(cr) from A1(cr).
The upgrade reflects MAR's continued strong core financial fundamentals, solid and stable profitability and firm capital safeguards, in addition to the strong financial performance backed by the support of the robust economy of the State of Qatar. The rating upgrade by Moody's took into account MAR's consistently strong asset quality performance (since it commenced operations in 2006) with a current non-performing financings (NPFs analogous to non-performing loans) of around 0.10% of total financing assets.
Products & Services
- Return on average assets continues to be one of the highest in the market at 2.37%
- Return on average shareholders' equity, of the bank, before distribution, reached 16.77 % compared to 17.72% at the end of year 201 5
- Earnings per share for the period reached QAR 2.767 compared to QAR 2.764 at the end of year 201 5 .
- Book value per share, before distribution, reached QAR 16.94, compared to QAR 16.06 on December 31 201 5 .
- Capital adequacy ratio reached 18.85% using Basel-III and QCB standards compared to 18.54% on December 31 2015.
- Operational Efficiency ratio (cost to income ratio) is at 18.09% continues to be one of the best in the region.
- Non-performing Financing (NPF analogous to non-performing loans) ratio of 0.16% continues to be one of the lowest in the banking industry. Reflecting a very strong and prudent credit risk management policies and procedures.
Masraf Al Rayan remains focused on providing integrated Shariah- compliant financing solutions for retail and businesses customers, as the bank has traditionally provided banking and financing solutions for individuals to meet their increasing needs. In the corporate sector, Masraf Al Rayan has a wide range of banking and financing solutions, all of which are compatible with the provisions of the Islamic Sharia. Masraf Al Rayan focuses also on developing its use of advanced technological resources offering comprehensive banking services via alternative channels such as retail and corporate internet banking, mobile banking App and telephone banking.
Human resources and training
Management at Masraf Al Rayan has put in place human resources plans to develop all employees across the organization and especially Qataris, through adopting
long term strategies in collaboration with the Ministry of Labour and other related local actors. In 2016, training hours (theory and practice) have exceeded 14,900,hours.
Social and environmental responsibility
Masraf Al Rayan continues to honor its social responsibility role towards society, which is embedded in its corporate governance principles and practice through supporting many events and activities that benefit individuals and institutions alike to exercise their role in building a better society. These programs cover humanitarian, health and sporting activities.