National Bank of Kuwait SAK, the country’s largest lender, posted a 0.4 percent rise in first- quarter profit, beating estimates, amid a “promising” outlook for growth this year.
Net income rose to 81.3 million dinars ($285.5 million) from 81 million dinars in the same period last year, the bank said in an e-mailed statement today. The median estimate of four analysts was for a profit of 79.5 million dinars, according to data compiled by Bloomberg.
This year “holds a promising outlook for the operating environment in Kuwait in contrast to last year, in light of the government’s position to adopt a more dynamic fiscal policy and to accelerate implementation of mega projects,” Chief Executive Officer Ibrahim Dabdoub said in the statement. “This is expected to boost economic activity and spur growth creating new opportunities in the local economy.”
The global credit crisis weakened lending and investment banking in the Middle East, pushing up loan-loss provisions and led to a drop in the value of investments. Corporate lending in Kuwait has lagged its peers in the Gulf Cooperation Council as conflict between the government and parliament stalled a $110 billion development plan to diversify the oil-reliant economy and modernize the nation. The executive and legislative branches this year pledged to put the investment plan, first approved in February 2010, on a fast track. Loans to private businesses grew 4.8 percent in the year to February.
NBK’s net operating income grew 10 percent to 147.3 million dinars, it said. The bank’s shares fell 1.1 percent to 930 fils at the close in Kuwait today. The stock has gained 1.7 percent this year compared with a 19.4 percent rise in the benchmark Kuwait Stock Exchange Index. There are 1,000 fils to the dinar.
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