Doha Bank’s H1 2025: Impairment Reduction Offsets Core Business Weaknesses, Driving Net Profit Growth

• The company's interest income declined by 1% year over year, but the net interest income margin experienced an improvement.

• Doha Bank’s shares increased as much as 28% during H1 2025.

• Net profit was pushed up by the improvement in interest margin, reduced impairments, and an increase in income from commissions and fees.

Doha Bank's stock demonstrated impressive performance in H1 2025, starting the year at 1.99 riyals per share and closing the first half of the year at 2.54 riyals per share, reflecting a substantial 28% increase in value. This performance significantly outperformed the Qatar Stock Exchange (QSE) Index, which saw an approximate 2% increase over the same period. Furthermore, insider confidence in the bank was evident, with insiders purchasing shares worth 30 million QAR during this time. This combination of price appreciation and insider activity highlights investor confidence and the bank's potential for sustained growth.

Here are the key numbers:

● Interest Income: 3,068 million QAR vs. 3,101 million QAR in H1 2024 (a 1% YoY decline).

● Net Interest Income: 989 million QAR vs. 975 million QAR in H1 2024 (a 1% YoY increase).

● Net Profit: 467 million QAR vs. 432 million QAR in H1 2024 (an 8% YoY increase).

● Earnings per Share: 0.150 QAR/share vs. 0.140 QAR/share in H1 2024 (a 7% YoY increase).

Doha Bank experienced an improvement in its net interest margin, which increased from 31% in H1 2024 to 32% in H1 2025. This decline is primarily attributed to the impact of declining global interest rates, which lowered borrowing costs at a pace exceeding the decline of interest income. On the other hand, the company faced a 1% decline in interest income, likely from the same reason.

Against the backdrop of a challenging macroeconomic environment and mounting concerns regarding an impending recession, the banking sector faced heightened credit risk. However, Doha Bank strategically opted to reduce impairments to a lower amount than in H1 2024.

The impact of this decision became evident in the company's financial performance for H1 2025, showcasing a positive impact on profit of 101 million QAR compared to the previous year.

During  H1 2025, the company decreased gain from investment activities. This negative shift had a significant impact on profitability, making an adverse impact of a remarkable amount of 56 million QAR. increase has had an adverse effect on the net profit, amounting to 66 million QAR.

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