Ahli Bank Posts H1 2025 Profit Growth as Lower Impairments and Strong Fee Income Offset Decline in Interest Income

• The company's interest income dropped by 12% year over year, accompanied by a decline in the net interest margin.

• Ahli Bank’s shares increased as much as 10% during H1 2025.

• Net profit recorded solid growth despite a significant drop in interest income and net interest margin. This increase was driven by higher commissions and fees, stronger investment income, and lower impairment charges.

During H1 2025, Ahli Bank's stock price experienced a strong increase. Commencing the period at 3.45 riyals per share, by the end of the period, the stock had settled at 3.79 riyals per share, reflecting a 10% increase in its value. In comparison, the QSE index increased by approximately 10% over the same period. This indicates that the company's stock performance overperformed compared to the market average. Also, within the period, Ahli Bank recorded a notable insider trade, where insiders sold stocks amounting to 13 million QAR.

Here are the key numbers:

● Interest Income: 1,539 million QAR vs. 1,756 million QAR in H1 2024 (a 12% YoY increase).

● Net Interest Income: 664 million QAR vs. 816 million QAR in H1 2024 (a 19% YoY increase).

● Net Profit: 402 million QAR vs. 383 million QAR in H1 2024 (a 5% YoY increase).

● Earnings per Share: 0.149 QAR/share vs 0.142 in H1 2024 (a 5% YoY increase).

Ahli Bank experienced a significant decline in its net interest margin, dropping from 46% in H1 2024 to 43% in H1 2025. This negative development followed interest rate cuts in 2024 and 2025 by major global central banks, primarily the Fed and the ECB. The decline in the net interest margin adversely impacted the bank’s net profit, which amounted to 51 million QAR. Additionally, the net profit was further affected by a substantial drop in interest income, amounting to 101 million QAR.

Ahli Bank’s core business benefited from improved performance across non-interest income streams. Commission and fee income rose significantly, contributing QAR 53 million to net profit, driven by higher transaction volumes and enhanced service offerings. Additionally, investment income added QAR 19 million, reflecting effective portfolio management and favorable market conditions. These developments helped offset some of the pressure from declining interest margins.

Facing challenges in the macroeconomic landscape and growing concerns of an impending recession in previous periods, the banking sector encountered heightened levels of credit risk. In a decisive move, Ahli Bank made substantial adjustments to impairment expenses during 2024. In H1 2025, management adopted a less aggressive position toward risk. This strategic decision had a notably positive impact on the company’s profits, amounting to 119 million QAR. This choice highlights Ahli Bank’s proactive approach to addressing and managing the risks associated with its asset portfolio amidst evolving economic conditions.

For more comprehensive information, please refer to the reliable financial information source, http://sahmik.com.