Doha Bank (DHBK) Q3 2024 earnings summary

Executive summary

• Transformation program 'Himma' launched, with 14 out of 80+ initiatives completed in 2024, focusing on digital innovation, governance, and risk management.

• New C-suite onboarded, including CFO and Chief Strategy & Transformation Officer, to drive transformation.

• Major partnerships signed with Mastercard and strategic alliance with GORD for ESG transformation; digital banking enhancements and exclusive customer campaigns launched.

• Interim results for the nine months ended 30 September 2024 show stable profitability with net profit of QR 690.4 million, up from QR 626.9 million year-over-year.

• The review report found no material misstatements and confirmed compliance with IAS 34.

Financial highlights

• Net profit reached QAR 690 million, up 10.9% year-over-year; net interest income declined 2.5% year-over-year despite 18.3% growth in interest income due to a 31.2% rise in interest expense.

• Total assets grew 14.1% year-over-year and 8.6% year-to-date, reaching QR 109.9 billion; loan growth at 5.4% YTD, targeting 6%-7% by year-end.

• Investment book up 30.8% year-over-year; customer deposits up 14.5% year-over-year, flat YTD.

• Cost to income ratio at 36.4%, above the projected 35%.

• Loan loss impairment at QAR 583 million, up 2.5% year-over-year; cost of risk at 131 bps, down from 179 bps last year.

Outlook and guidance

• Year-end loan growth guidance raised to 6%-7%.

• NIM guidance for year-end at 195 bps ±5 bps; further short-term NIM contraction expected with long-term widening as rates decline.

• Cost to income ratio expected to remain elevated for next couple of years, with revised guidance to be provided.

• NPL ratio guidance at 7%-7.5% for year-end; NPL coverage to reach 70% by year-end and 80%-85% in coming years.

• Capital adequacy ratio expected to remain stable in the short to medium term, with no need for further capital raising.