Dukhan Bank’s assets in 2020 grew significantly by 12% exceeding QR86 billion ($23.62 billion), underscored by a growth in its financing activities which exceeded 12.7% recording over QR58 billion, as compared to 2019.
Total revenues grew by 15.7%, to reach QR3.8 billion, while profit before loss of impairment of intangible assets and taxes exceeded one billion Qatari riyals, with a growth rate of 33%, as compared to QR766 million for the previous year.
Total expenses declined by 15.6% to QR939 million when compared to the previous year stemming from the Group’s efforts to control operating and financing expenses.
In view of the (Covid-19) pandemic and its impact on financial markets, as well as accounting for the performance of select economic sectors, including some of the bank’s subsidiaries, the management adopted a conservative approach to hedge for the uncertain circumstances. Thus, following a conservative assessment on the part of the management, the Group recorded a QR450 million decline in its intangible assets from subsidiaries acquired between 2009 and 2010.
The charge was recorded in the income statement for this year, which accounted for a decrease in the net profit reaching QR566 million, however, noting that the decline does not affect the level of liquidity or adequacy of the Group’s capital nor its operating results.
Commenting on these results, Sheikh Mohammed bin Hamad bin Jassim Al Thani, Chairman and Managing Director of Dukhan Bank, stated: “At Dukhan Bank, we are proud of what we have achieved this year. Stemming from a strong resilience, we have not only managed to deal with the challenges imposed by the pandemic but has also achieved unprecedented growth at all levels. This is in part from the adoption of a conservative business model which allows hedging for any defaults that might arise in the financing and investment portfolio in line with the instructions of the Central Bank. Additionally, the Group has looked into provisioning models which would match the uncertainty imposed by crisis, like the pandemic, and implement the
best international practices to enable the Group to cope with any negative conditions in the future. Moreover, the Group has been able to overcome the impact of the decline in intangible assets due its conservative approach in evaluating subsidiary companies and leveraging the QR600 million contingency reserve, accumulated in previous years, to manage the circumstances. Moving on, the Board recommends distributing cash dividends amounting to 10% of the nominal value of the shares to shareholders for the year 2020. We are fully confident that the Group will continue its impressive performance in the coming years.”
He added: “The most prominent event of this year for Dukhan Bank was the unveiling of its new identity, which marked the beginning of a banking journey to make Dukhan Bank ‘Qatar’s bank of choice’. Within its endeavours to confirm this position, the new identity comes in light of major positive transformations witnessed by the bank alongside ambitions to digitize its services and operations in providing operational efficiency and profitability as well as secure, safe and seamless banking experience for customers.
Furthermore, Dukhan Bank aspires to provide innovative banking products and services that meet customers’ evolving needs using the latest technological innovations in this field. Therefore, Dukhan Bank takes confident steps towards achieving strategic objectives in a way which enhances its position in the banking sector, grows its market share, and contributes to achieving the goals of Qatar Vision 2030”.
Khalid Yousef Al-Subeai, Group CEO, said: “Following the completion of the first merger in the Qatari banking sector in record time, we were able to realise benefits from the merger in terms of cost reduction, with the cost-to-income ratio dropping to 27.6% compared to 39.2% for 2019. The Group has succeeded in widening its customer base and market share, which reflects positively on its performance and financial results.”
Al-Subeai also highlighted the bank’s flexibility in overcoming the impacts of (Covid-19). He stated that Dukhan Bank has fully coordinated with the concerned authorities in the country to respond to the aftermath of the crisis. The bank activated an extensive crisis management plan in addition to strengthening its portfolio of online banking services. These steps enabled business continuity, allowing customers to conduct all their banking transactions easily and conveniently from their homes without the need to visit any of the bank’s branches.
Moreover, Dukhan Bank participated in the launch of the (Covid-19) National Guarantee Program under the directive of Qatar Central Bank to alleviate the financial pressures on private companies and Small and Medium Sized Enterprises (SMEs).
DIGITAL PRODUCTS AND SERVICES
Dukhan Bank’s financial success during the year 2020 comes in light of a robust digital transformation, contributing to improved customer experience, by the provision of integrated products and services for individuals and companies. Based on the pivotal role that digitisation plays in achieving Dukhan Bank’s vision, the management is committed to strengthening its leadership in this regard with a view to enhance the bank’s technological infrastructure and its portfolio for online banking services through further development of the website and mobile application. Also, it has increased the efficiency of its call centre, promoted the use of Dukhan Bank contactless banking cards, and continues to encourage customers towards these services through awareness campaigns.
In the fourth quarter of 2020, the aforementioned achievements confirm Dukhan Bank’s standing amongst the 10 safest banks in the Middle East and the 10 safest Islamic banks in the GCC for the year 2020. The annual rankings of the safest banks in the world, taken from The American Global Finance magazine, have been a reliable measure of financial security for more than 25 years. The best banks are selected based on evaluation of long-term foreign exchange ratings from international credit rating agencies: Moody’s, Standard & Poor’s, and Fitch; as well as the quality of the bank’s financial performance. In a similar context, Moody’s had confirmed the Dukhan Bank’s long-term credit rating at A2 / Prime-1, with a stable outlook, alongside Fitch’s affirmation at “A”. Both ratings reflect the strength and robustness of the Qatari
economy as well as the bank’s independent credit, which exhibits strong financial assets and an ability to play a leading role in the Islamic banking sector in Qatar.
In parallel, the relentless efforts of the Board of Directors and all employees of the bank during the past year were met with prestigious awards in several fields, Most User-Friendly Mobile Banking Application – Qatar 2020, International Finance Awards, and Most Progressive Bank Award, The New Age Banking Summit. Additionally, International Business Awards granted Dukhan Bank three distinguished awards, which included Banking CEO of the Year Qatar 2020 for Al-Subeai, Best Retail Bank Qatar 2020, and The Most Innovative Bank Qatar 2020. Moreover, Dukhan Bank won the Most Innovative Islamic Banking Product – Thara’a – Qatar, 2020, Global Business Outlook Awards 2020, and the Most Innovative Banking Brand, Qatar 2020 - Global Brands Magazine.-- Tradearabia News Service