NBK's strong operational performance continues with robust profits: Al-Sager

Kuwait Times

3 days ago

Vice Chairman and Group CEO speaks on the sidelines of H1 2025 analysts' conference call
KUWAIT: Isam Al-Sager, Vice Chairman and Group Chief Executive Officer of National Bank of Kuwait (NBK), stated that the Bank reported a net profit of KD 315.3 million for the first half of 2025, marking a 7.8 percent increase from KD 292.4 million in the corresponding period of 2024.
Speaking on the sidelines of the analysts' conference call for the first-half 2025 results, Al-Sager highlighted that profit before tax surged by 17.0 percent year-on-year, reaching KD 401.5 million in the first six months of the year. He explained that the new tax regime weighed on profitability, with the effective tax rate rising to 16.0 percent in the first half of 2025, up from 9.2 percent in the first half of 2024.
Al-Sager added that the Bank's pre-tax profit was further supported by the release of provisions for credit and impairment losses amounting to KD 10 million, compared to a charge of KD 43 million in the six-month period ended June 30, 2024.
'Our returns remained robust, with Return on Average Assets reaching (ROAA) 1.52 percent and Return on Average Equity (ROAE) standing at 15.1 percent for the period', Al-Sager said. He explained that the Bank is confident in its ability to adapt and maintain its leadership in the local market, highlighting its readiness to navigate economic headwinds and emerge even stronger, supported by its resilience, continued investment in technology and innovation, and steadfast commitment to meeting the evolving needs of its customers.
Isam Al-Sager, Vice Chairman and Group Chief Executive Officer
Dividend distribution policy
Regarding the dividend distribution policy, Al-Sager stated that NBK's approach remains unchanged, maintaining a sustainable framework that strikes a balance between delivering attractive shareholder returns and prudently managing capital ratios. He added that the Bank continues to prioritize effective capital planning to ensure capital levels align with its future growth ambitions, an approach it has consistently upheld and will continue to follow going forward.
Al-Sager stressed that the Bank remains committed to its approved dividend policy, noting that in light of the strong growth in its loan portfolio both locally and internationally, the Bank has opted to retain interim profits until year-end, with a focus on year-end final dividend distribution. This approach provides greater flexibility to capitalize on growth opportunities as they emerge throughout the year, in alignment with the Bank's strategic priorities.
He pointed out that NBK's regional and international presence plays a vital role in mitigating risks, sustaining stable returns, and enhancing operational efficiency. Furthermore, he added that the Bank remains focused on leveraging cross-selling opportunities across its diverse geographical footprint. At the same time, its wealth management arm will continue to capitalize on deep expertise to deliver a comprehensive suite of portfolio management, advisory services, and investment solutions. Meanwhile, the Bank's Islamic banking services will further strengthen their local footprint while diversifying sources of profitability.
Projects market momentum
Al-Sager emphasized that following a strong year of project market activity in 2024, particularly in the second half of the year, the pace of activity moderated slightly during the first half of 2025.
He noted that this moderation largely reflects a normalization from the elevated levels seen last year. Nonetheless, the outlook remains encouraging, supported by a pipeline of ongoing projects valued at KD 10 billion, signaling the government's continued commitment to advancing its development and reform agenda. Al-Sager affirmed the Bank's ongoing commitment to sustainability and the advancement of its sustainable finance agenda, highlighting the recent publication of its first Green Bond Allocation and Impact Report, as well as its inaugural TCFD Report. These disclosures underscore NBK's efforts to enhance transparency and accountability in its ESG and sustainable finance strategy. They also reflect the Bank's significant progress in integrating climate considerations across its operations, with a strong emphasis on portfolio diversification and climate risk management.
Meanwhile, Sujit Ronghe, Group Chief Financial Officer at NBK, stated that the Group continues to demonstrate strong operational momentum, driven by robust growth in business volumes, most notably across the loan and investment portfolios. He added that the Group continues to benefit from the strength of its loan portfolio, which demonstrates high asset quality and a well-considered diversification of growth sources. Ronghe explained that key business segments made strong contributions to net profit in the first half of 2025, highlighting their effectiveness as core pillars of the Group's diversification strategy and their role in reinforcing profit resilience.
He stressed that NBK Group continues to leverage its unique competitive advantages among Kuwaiti banks, particularly its broad geographic footprint and its ability to operate across both conventional and Islamic banking. Amid growing concerns over the impact of the ongoing tariff war and its implications for the global business landscape, Ronghe explained that NBK remains well-positioned to navigate this volatile environment, a testament to the strength and resilience of its diversified business model.
Regarding the catalysts for loan growth during the first half of 2025, Ronghe stated that corporate credit was the primary driver, emphasizing that demand was not concentrated in any single geographic area. Instead, it was well distributed across NBK's network, including the GCC region, international markets, and Boubyan Bank.