National Bank of Kuwait’s Q1 profit rises 15% to $438m

Country's biggest lender reports higher net-interest income for the period

National Bank of Kuwait headquarters. The bank reported higher income from net fees and commissions in the first quarter. Photo: NBK

The National Bank of Kuwait, the biggest lender in the Gulf state, has reported a more than 15 per cent jump in its first-quarter profit on the back of higher net-interest income and stronger fee income.

Net profit attributable to shareholders for the three months to the end of March rose to 134.2 million Kuwaiti dinars ($438 million), from 116.5 million dinars in the same period last year, the lender said on Tuesday in a filing to Boursa Kuwait, where its shares are traded.

The total profits reported by the bank were broadly in line with the EFG Hermes's estimate for the first quarter.

Net-interest income for the period surged 36 per cent year-on-year to 170.6 million dinars, while income from fees and commissions rose about 19 per cent to 51.3 million dinars. Non-interest income also grew slightly to 66.1 million dinars.

“NBK delivered [a] strong performance in the first quarter of 2023, building on the momentum of our exceptional performance in 2022, despite the challenging global economic environment, including geopolitical tensions, persistent inflation and the banking crisis in Europe and the United States," NBK Group chairman Hamad Al Bahar said.

The growth comes as Gulf economies continued to recover from the coronavirus pandemic on the back of higher oil prices and government reforms to boost non-oil revenue.

Gulf economies are performing well due to the “relentless” pursuit of reforms and not merely because of high oil and gas prices, IMF managing director Kristalina Georgieva said earlier this year.

“There is this impression that the only reason the Gulf countries are doing well is high oil and gas prices — this is not true,” Ms Georgieva said at the World Government Summit in Dubai.

“They have been opening up more space for private investments and for jobs being generated by competitive businesses.”

NBK's total customer deposits for the first quarter rose 12 per cent annually to 20.4 billion dinars, while loans, advances and Islamic financing to customers grew about 6 per cent to 21.1 billion dinars.

Total assets climbed 8 per cent to 36.4 billion dinars, according to the financial statement.