Press Release

Financial Results For The Three Months Ended 31 March 2017

Qatar National (Q.P.S.C.) Tel: (+974) 4440 7407 P.O. Box 1000, , Fax: (+974) 4441 3753 qnb.com

QNB Group's Key Financial Highlights

• Net Profit increased to QAR3.2 billion, up by 12% from March 2016

• Total Assets reached QAR743 billion, up by 35% from March 2016

• Net Loans and Advances up by 33% from March 2016 to reach QAR536 billion

• Customer Deposits increased by 34% from March 2016 to reach QAR541 billion

• Improved liquidity with Loans to Deposit ratio dropping to 99%

• Earnings per Share increased to QAR 3.5, compared to QAR 3.1 in March 2016

• Total Equity reached QAR71 billion, up by 17% from March 2016

QNB Group’s Key Non-Financial Highlights

• QNB Group’s presence spans more than 30 countries across three continents.

• QNB Group staff exceeds 28,000 serving more than 21 million customers through 1,250 locations and 4,300 ATMs.

QNB Group, the largest financial institution in the Middle East and Africa (MEA) region, announced its results for the three months ended 31 March 2017.

Key indicators of the financial results for the three months ended 31 March 2017 are shown below.

Achieve Sustainable Profitable Growth

Income Statement Mar-17 Mar-16 Growth (QAR billion)

Net Interest Income 4.2 3.3 27%

Net Fee & Commission Income 0.9 0.5 60%

Net Gain on Foreign Exchange 0.2 0.2 10%

Operating Income 5.4 4.1 34%

Total Expenses 1.6 0.9 70% Net Profit attributable to Equity 3.2 2.9 12% Holders

Key Performance Indicators Mar-17 Mar-16

Earnings per Share (QAR) 3.5 3.1

Cost to Income Ratio 28.9% 22.7%

For the three months ended 31 March 2017, Net Profit reached QAR3.2 billion, up by 12% compared to previous year. This was mainly driven by operating income, which increased to QAR5.4 billion, up by 34% compared to March 2016, demonstrating QNB Group’s success in maintaining growth across the range of revenue sources, despite a turbulent macroeconomic environment and currency volatility experienced in our core markets.

Net interest income increased by 27% to reach QAR4.2 billion, with net fee and commission income and net gain from foreign exchange reaching QAR0.9 billion and QAR0.2 billion, respectively, reflecting success in diversifying sources of income.

The Group’s prudent cost control policy and strong revenue generating capability allowed it to maintain an efficiency ratio (cost to income ratio) of 28.9%, which is considered one of the best ratios among financial institutions in the region.

Maintain Strong Financial Strength

Balance Sheet Mar-17 Mar-16 Growth Dec-16 Growth (QAR billion)

Total Assets 743 550 35% 720 3%

Loans and Advances 536 402 33% 520 3%

Deposits 541 403 34% 507 7%

Equity 71 60 17%

Key Performance Mar-17 Mar-16 Dec-16 Indicators

Loan to Deposit Ratio 99.0% 99.7% 103%

NPL Ratio 1.8% 1.4% 1.8%

Coverage Ratio 114% 120% 114% Total assets increased by 35% from March 2016 to reach QAR743 billion, setting a benchmark for peer financial institutions. This was driven by a growth rate of 33% in loans and advances to reach QAR536 billion.

The Group was able to maintain the ratio of non-performing loans to gross loans at 1.8%, a level considered one of the lowest amongst financial institutions in the MEA region, reflecting the high quality of the Group’s loan book and the effective management of credit risk. The Group’s conservative policy in regard to provisioning continued with the coverage ratio maintained at 114% as at 31 March 2017.

QNB Group was successful in attracting new customer deposits to comply with the cap on loans to deposit ratio of 100% set by QCB, which is effective from end of 2017. These deposit mobilisation efforts resulted in increased customer funding by 34% to reach QAR541 billion from March 2016. This led to the Group’s loan to deposit ratio reaching 99%.

Growing International Presence

QNB Group has received approval for a branch opening license from the Saudi Arabia Monetary Agency (“SAMA”) in 2016. In March 2017, QNB launched its operations in the Saudi capital, Riyadh. This branch is a significant milestone in QNB Group’s strategy of international expansion. The Group will support the various economic development initiatives by offering its broad suite of wholesale and corporate banking products and services. It will also leverage its in-depth expertise in areas such as structured/project finance and transaction banking.

Enhance Shareholder Value

Total Equity increased by 17% from March 2016 to reach QAR71 billion as at 31 March 2017. Earnings per Share reached QAR3.5, compared to QAR3.1 in March 2016.

Capital Adequacy Ratio (CAR) calculated as per the QCB and Basel III requirements stood at 15.7% as at 31 March 2017, higher than the regulatory minimum requirements of the Qatar Central Bank and Basel Committee. The Group is keen to maintain a strong capitalisation in order to support future strategic plans.

Maintains a strong Credit Profile

QNB Group has maintained its position as one of the strongest rated financial institutions in the region. This is a result of QNB Group’s strong financial position, high quality of its assets and its leading position in the sector.

Institution of Choice

QNB Group continued to highlight its dedication to high quality service and product offerings as evidenced by the receipt of awards including “Best Bank in Qatar 2017’’ by Global Finance, Best Bank in Qatar by Asiamoney’’, “Most Innovative Bancassurance Product Qatar 2016” award by the International Finance Magazine (IFM), “Best Commercial Banking Capabilities in Qatar” by Euromoney as well as many other awards received by the Group.

Ensure Strong Brand Recognition and High Brand Value

Based on the Group’s continuous stellar performance and its diversified international presence, QNB is now the most valuable banking brand in the MEA region, with the value of its brand increased to USD3.8 billion to rise to the 60th place globally, in addition to attaining the highest rating of AA+ in brand strength.

Enhancements to Compliance Capabilities

On an on-going basis, QNB Group improves its capabilities to comply with statutory and regulatory requirements by implementing several enhancements to its infrastructure which is a fundamental aspect of achieving the Group’s goals, objectives and expansion strategy. Tailored training programs were also introduced to suite the diverse nature of business and activities of QNB Group in a face-to-face and online basis in order to foster the compliance culture and train all employees periodically on the principles of compliance, Whistle Blowing, Chinese Walls, AML/CFT. The “Lessons Learned” also became a point of focus to Group Compliance in order to support the Executive Management to improve the efficiencies of the Group’s operations and of its data, information and financial channels considering that the fraud and data breaches cases happening around the world provides landscape for imposing new requirements by the regulatory authorities to safeguard the global financial system.

Ensure Outstanding Talent Pool

QNB continues with its focus on training and development programs to employees at all levels with an opportunity to develop and identify the top talents within the Group.

Subsequent to the Employment Engagement Survey conducted last year by QNB, several initiatives which have been undertaken to improve how employees view and operate within QNB Group. Also QNB has undertaken multiple initiatives to strive towards being recognized as an Employer of Choice by both staff and potential candidates.

QNB continues to place high emphasis on recruiting nationals in all countries in which the Group operates, providing them with dedicated training programs to further enhance their capabilities. This has resulted in the Bank having a Qatarization ratio that exceeds 52% in Qatar, the highest among financial institutions in Qatar.

QNB built on the previous successes in its development of Qatari Nationals via targeted deployment to overseas branches and subsidiaries so as to give the future leaders of the bank detailed exposure of the countries/markets that we operate in. In 2017, QNB plans to increase the scope of this program to start having Qatari staff permanently deployed to key countries to not only increase the development of the individual, but also strengthen the service provided to Qatari customers and their businesses overseas.

QNB Group is present, through its subsidiaries and associate companies, in more than 30 countries and 3 continents providing a comprehensive range of products and services. The total number of staff for the Group is more than 28,000 operating from 1,250 locations and 4,300 ATMs serving more than 21 million customers.