C Bk Qatar S Regulatory News (CBQS)

NEWS RELEASE

Commercial Bank of Qatar

Financial Results for the quarter ended 31 March 2014

Commercial Bank delivers first quarter net profit of QAR 548 million

28 April 2014, Doha, Qatar: Commercial Bank of Qatar ("Commercial Bank" or "the Bank") today announced its financial results for the quarter ended 31 March 2014. The Bank delivered a net profit for the first quarter of QAR 548 million compared to QAR 506 million in the first quarter of 2013.

Key financial highlights

· Operating income up 24% over first quarter 2013 to QAR 936 million

· Net profit up 8.5% over first quarter of 2013 to QAR 548 million

· Total assets up 33% over first quarter 2013 to QAR 114 billion

· Customer loans and advances up 34% over first quarter 2013 to QAR 68.7 billion

· Customers' deposits up 35% over first quarter 2013 to QAR 62 billion

Sheikh Abdullah bin Ali bin Jabor Al Thani, Chairman of the Board of Directors of Commercial Bank said, "Qatar's infrastructure investment requirement to support its rapidly diversifying economy under the leadership of His Highness Sheikh Tamim bin Hamad Al Thani, Emir of the State of Qatar, is producing positive market conditions for Commercial Bank's products and services. The Bank's wider group strategy is also benefiting from the momentum in public and private sector investment in the UAE, Oman and Turkey driven by positive economic conditions. The Bank's encouraging performance in the first quarter bodes well for the rest of the year."

Financial Performance

Mr. Hussain Al Fardan, Commercial Bank's Vice Chairman and Managing Director, added, "The momentum of the fourth quarter of 2013 has carried through to the first quarter of 2014 and the Bank has delivered good financial results. We have improved our profitability by 8.5% over the first quarter of 2013 to QAR 548 million with strong profit generation from across the Group."

Net operating income increased by 24.3% to QAR 935.7 million for the quarter ended 31 March 2014, up from QAR 752.5 million achieved for the quarter ended 31 March 2013. ABank delivered net operating income of QAR 183.5 million for the current quarter.

Net interest income was QAR 620.8 million for the quarter ended 31 March 2014, 36.8% higher than for the same period in 2013, reflecting strong growth in lending activities. ABank contributed QAR 139.9 million, 22.5% of the total net interest income. Net interest margin remained stable compared to the fourth quarter of 2013 at 2.6%.

Non-interest income was up 5.4% to QAR 315 million for the quarter ended 31 March 2014 compared with QAR 298.7 million for the same period in 2013 with ABank contributing QAR 43.6 million. The overall increase in non-interest income was due to higher fee and commission income and was partially offset by lower income from investments securities.

Total operating expenses were up 66.8% to QAR 406.9 million for the quarter ended 31 March 2014 compared with QAR 244 million for the same period in 2013. Excluding ABank, expenses increased by 10% for the current quarter compared to the same period in 2013 as Commercial Bank continued to invest in its people and infrastructure.

The Bank's net provisions for impairment losses decreased to QAR 59.3 million for the quarter ended 31 March 2014 compared with QAR 69.5 million for the same period in 2013. Non-performing loan ratio decreased marginally to 3.55% in March 2014 from 3.65% at 31 December 2013 and the coverage ratio improved to 65.2% as at March 2014 compared to 63% in December 2013. Impairment provisions on the Bank's investment portfolio decreased to QAR 8.4 million for the quarter ended 31 March 2014 compared with QAR 10 million for the same period in 2013.

Commercial Bank delivered strong balance sheet growth at the end of the first quarter of 2014 increasing by 33.2% with total assets at QAR 114 billion compared to QAR 85.6 billion at the same period in 2013 which includes QAR 18.4 billion of assets from ABank. Balance sheet growth was driven by QAR 17.3 billion in lending to customers, higher balances held with Central Banks which were up QAR 4.3 billion, combined with an increase of QAR 4.1 billion in Investment securities.

Loans and advances to customers were up --33.6% to QAR 68.7 billion at 31 March 2014, compared with QAR 51.4 billion at the end of March 2013. The growth in lending was generated mainly through credit growth in the Real Estate, Industry and Government sectors. Loans and advances to customers of QAR 12.1 billion at ABank were included at 31 March 2014.

Customers' deposits have grown by 34.5% to QAR 62.1 billion at 31 March 2014, compared with QAR 46.2 billion as at 31 March 2013, supporting Commercial Bank's growth in lending. The increase in deposits has come mainly from higher demand, savings and time deposit balances and the inclusion of QAR 8.6 billion for ABank. This underpins our strategy to ensure continued diversification of our funding base and focus on growing low cost funds.

Mr. Andrew Stevens, Commercial Bank's Group Chief Executive Officer, said, "All four banks in the Commercial Bank Group generated robust growth during the first quarter of the year. Our continued investment into Commercial Bank Qatar, ABank and our Associates, UAB and NBO, is generating growth from a combination of local and group strategies. Whilst closely monitoring our asset quality, we expect to deliver continued growth through the course of the year as we target increasing income from our core revenue by pursuing improvement in profitability and returns against a stable cost basis across the Group."

Mr. Abdulla Saleh Al Raisi, Commercial Bank's Chief Executive Officer, commented, "We are seeing the benefit of investments we made in the business last year. Our ongoing commitment to ensuring Commercial Bank is Qatar's private sector market leader in providing banking products and innovative services that cater to all our customers' needs is seeing good progress as we successfully defend our position in Wholesale and continue to grow our presence in the Retail market."

Subsidiary in Turkey

Alternatifbank ("ABank") delivered a net profit of TL 34 million for the quarter ended 31 March 2014 (TL 29 million for the same period in 2013).

During the quarter, Ms. Meric Ulusahin was appointed by Commercial Bank as ABank's new CEO to lead its SME focused growth strategy as the Group builds a challenger banking brand for the Turkish market.

Associates in the UAE and Oman

UAB and NBO have achieved a strong financial performance for the first quarter in 2014 with 37.5% improvement in profitability as compared to the same period in 2013.

National Bank of Oman

National Bank of Oman (NBO) achieved a net profit of OMR 10.3 million for the quarter ended 31 March 2014 as compared to OMR 8.6 million, an increase of 20% over the same period in 2013. Operating income grew by OMR 1.9 million to OMR 26.3 million, from OMR 24.4 million in the quarter ended 31 March 2013, mainly due to an increase in net interest income which was up 8.7% to OMR 18.9 million. As at 31 March 2014, NBO grew its customer lending by 6.1% to OMR 2.1 billion and customers' deposits increased by 37% to OMR 2.8 billion compared with the same period in 2013.

United Arab Bank

United Arab Bank (UAB) delivered a net profit of AED 161 million for the quarter ended 31 March 2014 which represents an increase of 34% over the same period in 2013 results of AED 120 million. The total operating income for the quarter ended 31 March 2014 increased by 45% to AED 327 million, from AED 226 million for the same period in 2013 with robust underlying performance from both Net Interest Income and Non-Interest Income, up 42% and 52% respectively against the same period in 2013. UAB's loans and advances increased by 47% to AED 17.2 billion as at 31 March 2014, with customers' deposits at AED 16.4 billion, up 46% compared to the same period in 2013.

 Click on, or paste the following link into your web browser, to view the associated PDF document:http://www.rns-pdf.londonstockexchange.com/rns/7138F_-2014-4-28.pdf

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For more information please contact:

Mona Abdallah Jon Earl

Head of Corporate Communications Managing Director

Commercial Bank F T I Consulting

Tel: +974 4449 0169 Tel: +971 (0) 50 494 1178

Email: m.abdallah@cbq.qa Email: jon.earl@fticonsulting.com

Notes to Editors

About Commercial Bank

Commercial Bank has total assets of QAR 114 billion as at 31 March 2014. As a full service commercial bank, the Bank offers a full range of corporate, retail and investment banking services as well as owning and operating exclusive Diners Club franchises in Qatar and Oman. The Bank's countrywide network includes 34 full service branches and 154 ATMs.

Profitable every year since incorporation in 1974, continual investment in technology and human capital, together with a strong capital base, provides a solid foundation for continued growth. A successful diversification strategy has expanded Commercial Bank's GCC footprint through strategic partnerships with associated banks, the National Bank of Oman (NBO) in Oman and United Arab Bank (UAB) in the UAE. NBO, the second largest bank in Oman with total assets of OMR 3.5 billion as at 31 March 2014, has 62 branches in Oman and 1 branch each in Egypt, Abu Dhabi and Dubai. UAB is headquartered in Sharjah, with total assets of AED 23.6 billion as at 31 March 2014, and operates 26 branches across the emirates in the UAE. Building on the successful execution of the Bank's expansion strategy to date, Commercial Bank completed the acquisition of a majority stake in Alternatifbank in Turkey in July 2013.

Commercial Bank enjoys strong credit ratings of (A) from Fitch, (A1) from Moody's and (A-) from Standard & Poor's. The Bank is listed on the Qatar Exchange and was the first Qatari bank to list its Global Depository Receipts (GDRs) as well as bonds on the London Stock Exchange. Additionally, Commercial Bank's Swiss Franc bond issuance in December 2010, listed on the SIX Swiss Exchange, was the first public bond issuance by a Qatari bank in Switzerland.

The Bank is dedicated to supporting Qatar's community and social infrastructure through Corporate Social Responsibility programmes and sponsorship of various events. Title sponsorship of the Commercial Bank Qatar Masters and the Grand Prix of Qatar Moto GP reflects the Bank's promotion of excellence in sports and its keen interest in enhancing Qatar's international sporting reputation. To reinforce Qatar's flourishing cultural environment, Commercial Bank is the strategic partner of the Katara Cultural Village. This collaboration symbolises the Bank's commitment to supporting cultural activities in Qatar and making the country a regional arts and cultural hub.

www.cbq.qa

About Alternatifbank (ABank)

ABank was established in 1991 and has been listed on the Istanbul Stock Exchange since 1995. Commercial Bank became the majority shareholder in ABank in 2013 holding a 74.24% stake, following the acquisition of ABank shares of 70.84% from the Anadolu Group and 3.40% through a public tender offer. Anadolu Group remains a significant shareholder retaining 25% of shares in ABank.

ABank is a mid-size Turkish bank that predominately serves medium-sized companies through a country-wide network of 73 branches in 27 cities (as of 31 March 2014). ABank provides commercial/corporate banking services and products, with a special focus on the growing segment of Small and Medium-Sized Enterprises. The Bank's main product ranges cover trade finance instruments, working capital finance, cash management, and portfolio management. The Bank has also recently made a strategic decision to re-enter Retail Banking, targeting the "mass affluent segment" in terms of customer profile with tailor made products.

At 31 March 2014, ABank had total assets of TL 10.9 billion, total loans stood at TL 7.1 billion, customer deposits of TL 5.1 billion and shareholders' equity of TL 810 million.

http://wwweng.abank.com.tr