Posted on April 06, 2011

Capital Intelligence (CI), the international credit rating agency, Tuesday announced that it has raised Qatar National Bank's (QNB's) Financial Strength Rating (FSR) to 'AA-' from 'A+'.

The ratings action follows continuous improvement in the Bank's overall performance and financial condition, as these are reflected by the Bank's very strong credit metrics. The Bank's Long-Term and Short-Term Foreign Currency Ratings are affirmed at the same level as the Sovereign Ratings of 'AA-' and 'A1+', respectively. The Support Rating of '1' is also affirmed, based on the Bank''s systemic importance and strong ownership by the Qatar Investment Authority which holds 50% of capital. The Outlook for all Ratings is 'Stable'' QNB's intrinsic financial condition is very strong.

Capital is to be increased by 25% in the second quarter of this year through a rights issue which will boost capital adequacy to a very strong level. The Bank has consistently delivered improved performance and a high return on equity, based on its excellent cost/income ratio. The non-performing loan ratio remains very low, with more than full loss reserve coverage reflecting the Bank's conservative provisioning. QNB's liquidity continued to improve to a very good level, thanks to outstanding growth in customer deposits.

The Bank's ratings also reflect a stable and supportive operating environment, as well as QNB's dominant share of the Qatari banking market. QNB was founded in 1964 as the first Qatari-owned joint stock commercial bank in the country. In Qatar, the Bank operates a domestic network of 59 branches. QNB's international operations have been gradually expanded over the years and cover more than 20 countries, including branches in London, Paris, Singapore, Yemen, Kuwait, and Oman, investments in associate banks in Jordan, Iraq, Tunisia, Switzerland, the UAE and Syria as well as representative offices in other markets. In February 2011, QNB completed the acquisition of a majority stake in Bank Kesawan, Indonesia.

source: QNA