MUMBAI: The Indian busines of Qatar National Bank (QNB), one of the largest banks in the Middle East with an asset base of $346 billion (about Rs29 lakh crore) is in loss.
According to a recent report released by a rating agency, the Indian operations of QNB closed the financial year 2023-24 (FY24) with a net loss of Rs7.58 crore compared with a marginal net profit of Rs9 lakh, the bank reported for the previous year.
Operating income
QNB earned a total operating income of Rs54.90 crore for FY24 against Rs36.69 crore the bank earned for the previous year.
QNB is the largest bank in Qatar and one of the largest banks in the Middle East and Africa (MEA), in terms of assets, which stood at $346.3 billion as on June 30, 2024.
Moreover, the bank controls more than half of the banking business in Qatar.
QNB has an international network in more than 28 countries across three continents, providing a range of products and services to its customers.
QNB had infused equity capital of Rs165.9 crore in Q4 FY2024 in the Indian branch to support its growth.
6 years completed
QNB commenced operations in India in FY2018. The overall operations remain limited to a single branch and the scale remains small on account of the relatively early stage of operations in the country.
“Given the limited scale of the branch, the profitability levels remain suboptimal, while the advances and deposit profiles remain concentrated,” an ICRA report noted.
The report noted that the Indian branch primarily lends on a short term basis to match the short tenure of its wholesale deposits, supporting its liquidity profile.
In addition, it maintains excess holding of Government securities (G-Secs). The bank can avail liquidity support of up to 100 per cent of the Tier I capital from its head office in case of urgent liquidity requirement.
Systematically important bank
QNB is classified as a systematically important bank (SIB) in Qatar as it is the largest bank in the country as well as one of the largest banks in the MEA region in terms of assets, advances and deposits
The Indian branch had reported one account as a non-performing advance (NPA) since the commencement of operations in India, amounting to Rs52 crore in FY2021.
However, the same was technically written off in FY2024.
As a result, the gross NPA and net NPA were nil as on March 31, 2024
QNB was established in 1964. The Qatari government is the largest shareholder with a about 50 per cent stake through its investment arm – Qatar Investment Authority (QIA).
