Lesha Bank LLC (QFBQ) Earnings Call Transcript & Summary

Hello, and welcome to the Lesha Bank conference call. I would like to advise all participants that this call is being recorded. Thank you. I'd now like to welcome Mr. Shahan Keushgerian to begin the conference. Shahan, over to you.

Thank you. Good morning. Thank you all for joining us for Lesha Bank's First Quarter 2024 Conference Call. So on this call, we have today from the management, Muhammad Tauseef, Bank CFO. So as usual, Muhammad will first go over the performance. And then we will have a Q&A session immediately after. I will now turn the call over to Tauseef. Please go ahead.

Thanks, Shahan. Good morning, and [Foreign Language] everyone. He has already introduced me, so I am not going much into introduction. I'll just give you a brief and then it will be open for question answer. So the net profit -- the net profit for the Lesha Bank is QAR 28.8 million, which is increased by 30.1% as compared to the last same period. For the Q1 income from placement reached to QAR 44.8 million, and this is we know because there is a higher interest margin recently in the market since 2, 3 years. Profit on Sukuk reached to QAR 25.6 million and the fee and dividend income reached to QAR 19.9 million. This is the composition of the total income. Total assets are at QAR 7.6 billion as of 31st March 2024, it has increased by 52% compared to the previous year of QAR 5 billion. Additionally, the bank investment reached to QAR 2.8 billion, up by 27% from QAR 2.2 billion on March -- 31st March 2023. The bank's total customer deposit reached to QAR 3.6 billion in Q1 2024, which is up by 23% year-on-year. The total equity of the bank is QAR 1.2 billion from QAR 1.1 billion on 31st March 2023. And some key ratios, the return on average equity is 9.26%, which improved from the last period. Return on average assets is 1.66%. The book value is QAR 1.12, earnings per share annualized is QAR 0.026. Earnings per share is not annualized, sorry. It's the -- for the period, QAR 0.026. The capital adequacy ratio is 17.82% as of 31st March is slightly lower because of some of the new investments. And the last but not least, the AUM. Our AUM at 6.4 billion. It is 11% year-on-year growth. So this is the high-level brief if then we can open for the question and answer question. We're here for questions. Thank you very much.

[Operator Instructions] Our first question comes from the line of Andrew Brudenell from Ashmore.

I'm sorry. I only just got on, so I missed that. But what I wanted to ask is a little bit about what you're seeing in terms of asset quality, please. If you could give us a sense of any change you're seeing in recent month's recoveries? Any particular sectors? I mean the obvious ones that are sometimes worrying, real estate, hospitality, construction. I'd be interested to hear what you're sort of seeing in this area, please?

Thanks for your question. Actually, first, I will elaborate what is our business model. But previously, we were working more on the financing side, which is the normal loans to the customers, which is not anymore in our strategy. Whatever the previous loans were there, which have -- wherever we had a problem in the past, they have been provided 100%. We don't have any [ deterioration ] at this moment. All the loans where it was needed, it has been provided and the current portfolio is on a good health. We don't have any issue. Our business model is working more on the private equity and the private equity and on the real estate investments, which we don't have any issue. There is a recurring income from the management and all that is based on the syndication methodology. The third, we have recently opened the public equity, which we are also started the new department. But as far as financing is concerned, we don't have any much issue and the most of the financing is in the Stage 1.

Okay. But you don't see -- you don't have any data on -- within the real estate space in kind of like demand/supply, occupancy rates, areas of pressure. You don't have any data on that?

Maybe private investor.

Yes. But... I will just give you an overview that everybody knows that once the interest rates have changed since some 2, 3 years. So there is a pressure on real estate and what was the decrease in value, although it's not very significant, but we have booked in our financials in December. So the all impact, whatever the prices decreased in the U.S. because of our main investments are in U.S. that has already been taken into account. Overall, we are very positive in the long run, and we have a proper exit strategy against each and every investment. And we believe that we don't have any issue at the moment. And once the interest rates definitely has to change in -- if not this year, can be early next year, then definitely, the real estate prices will improve. But just in a nutshell, whatever the prices has been and everything has been accounted for and our real estate portfolio is really healthy, and we have -- we are very positive on that.

[Operator Instructions] There's been no further questions at this time. I will now hand the call back over to Mr. Shahan Keushgerian.

Okay. If there are no more questions, we can wrap this up, and we'll pick it up again next quarter. Thank you.

Sorry to interrupt in between. It's because maybe some people couldn't ask the question. If somebody has questions, they can send us send us e-mail. We can -- we will be happy to reply. Thank you very much.

Thank you. This concludes today's conference call. You may now disconnect.