The National Bank of Kuwait (NBK), the largest Kuwaiti bank, reported net profits of USD 894.2 million (KD 261.8 million) for the year 2014 compared with USD 813.3 million (KD 238.1 million) in 2013, 10% year on year growth. As of end of 2014, NBK Group's total assets reached USD 74.4 billion (KD 21.8 billion) up 17.1% compared to year-end 2013, while total shareholders' equity increased by 5.8% year on year to USD 8.6 billion (KD 2.5 billion). Loans and advances reached USD 40.7 billion (KD 11.9 billion) at year-end 2014 up 11.3% compared to year-end 2013 and customer deposits reached USD 38.5 billion (KD 11.3 billion), up 7.5% compared to 2013. Asset quality ratios continued to improve with Non-performing loans (NPL) to gross loans ratio dropping to 1.5% in year-end 2014 from 1.96% in 2013 and NPL coverage ratio increasing to 276% at year-end 2014 from 200% in 2013. NBK's board of directors has recommended a cash dividend of 30 fils per share (30% of the par value) and 5% bonus shares (5 shares for every 100 shares). Nasser Al-Sayer, NBK Chairman said "NBK's 2014 profits reflect the pickup in business volumes and the group's ability to benefit from the ongoing improvement in the operating environment. NBK's net operating income reached USD 2,258 million in 2014 (KD 661 million) up from USD 2,139 million in 2013 (KD 626 million), up 5.6% a year on year." Al-Sayer highlighted that the operating environment in Kuwait continued to show strong signs of improvement in 2014 "There is significant improvement in the domestic operating environment that is quite evident in the acceleration of the award and execution of the mega development projects. This improvement has reflected positively on NBK's volume growth and accordingly strong fee business and operating income. During the year, we witnessed the award of several landmark projects where NBK had a lead role in their financing" Al-Sayer added. Al-Sayer also said "We remain optimistic on the outlook of the GCC generally and Kuwait specifically despite the acute drop in oil prices. The Gulf economies benefit from a very strong balance sheet with significant reserves which will allow them to continue with their expansionary policies." On the other hand, Isam Al-Sager, NBK Group CEO commented "NBK remains focused on its strategy to geographically diversify its income sources through strengthening its market positions both locally and regionally. On the local front, NBK maintained its top market position growing all its business lines in Kuwait. The bank also continued to benefit from its earlier expansion into Islamic banking following the acquisition of 58.4% of Boubyan Bank in 2012 as the contribution of Boubyan Bank to the Group profits continues to grow." On the regional front, Al-Sager confirmed that NBK's subsidiaries, affiliates and branches continued to deliver very strong results strengthening NBK's position as a leading regional bank. In 2014, profits from NBK's international operations grew by 6.4% year on year despite the ongoing challenges in some of the regional markets. During the 3Q 2014, NBK agreed to sell its 30% stake in its Qatari associate, International Bank of Qatar (IBQ), as we saw limited opportunity to increase it to a controlling stake. This sale will strengthen the bank's capital position to pursue its regional expansion strategy and benefit from any opportunity in Qatar or other GCC markets. It is worth highlighting that the financial impact of this transaction is not reflected in the 2014 results. Al-Sager also stressed that Egypt represents an important market for the group as NBK seeks a stronger position in the Egyptian market through higher growth targets. This reflects NBK's positive economic outlook for the Egyptian market which offers significant growth potential on the back of the recent positive developments on the security level and political environment. NBK has recently rebranded its Egyptian operations to National Bank of Kuwait – Egypt," Al-Sager concluded. NBK continues to enjoy collectively the highest ratings among all banks in the Middle East from the three international rating agencies Moody's, Fitch Ratings and Standard and Poor's. The Bank's ratings are supported by its high capitalization, prudent lending policies, and its disciplined approach to risk management, in addition to its highly recognized and very stable management team. NBK was also named among Global Finance's list of the 50 safest banks in the world for the ninth consecutive time. NBK enjoys the widest banking presence with an international network of worldwide branches. NBK's international presence spans many of the world's leading financial centers including London, Paris, Geneva, New York and Singapore, as well as China (Shanghai). Meanwhile, regional coverage extends to Lebanon, Jordan, Iraq, Egypt, Bahrain, Saudi Arabia, the UAE, and Turkey.
