DOHA: Qatari banks posted a combined net profit of QR14.2bn ($3.9bn) in the first half (H1) of 2025, a marginal 1 percent increase compared with the same period last year, according to a recent report by Moody’s Ratings. The modest growth is largely attributed to higher income, which was partially offset by increased costs and provisioning charges.
Moody’s said aggregate operating income rose 5 percent year-on-year (YoY), supported by higher net interest income and fee-based revenue.
Net interest income grew by 5 percent due to lower funding costs, with interest expenses down 2 percent as liabilities were repriced. Interest-earning assets also expanded by 8 percent, helping maintain the sector’s net interest margin (NIM) at 2.2 percent.
Non-interest income contributed to the topline growth as well, climbing 4 percent due to a 12 percent rise in net fees and commissions. This increase more than offset weaker foreign-exchange income.
Analysts noted that the provisioning costs also rose. Loan-loss provisions increased by 8 percent YoY, largely due to a significant rise at one large bank. While the cost of risk remained stable at 0.8 percent of gross loans, Moody’s said provisioning remains elevated for banks exposed to the struggling real estate and contracting sectors.
The banks nonetheless maintained a strong coverage ratio of 138 percent as of June 2025.
Moody’s expects non-hydrocarbon GDP growth in Qatar to accelerate slightly to 3.5 percent annually in 2025 and 2026, supported by liquefied natural gas expansion projects, sporting events, exhibitions, and tourism activity. Private-sector credit growth is forecast to reach 6 percent this year, up from 4 percent in 2024.
