Lesha Bank LLC (QFBQ) Earnings Call Transcript & Summary

Good morning, and thank you for standing by. Welcome to the Lesha Bank Results Call. Please note, today's call is being recorded. I would like to hand over to the moderator to begin the call. Please go ahead.

Thank you. Hello, everyone. I want to welcome you to Lesha Bank's Second Quarter 2024 Financial Results Conference Call. On this call from management, we have Tauseef Malik, the Bank's Group CFO. So as usual, we will conduct this call with first management reviewing the company's results followed by a Q&A session. I will turn the call over now to Tauseef. Please go ahead.

Assalamu'alaikum and Good morning, everyone. As Shahan mentioned, we will just give you the brief on the results of Lesha Bank. And then after that, there will be question-and-answer, if any. So the Lesha Bank, I'll just give you the high-level figures. The net profit for Lesha Bank shareholder is QAR 54.1 million, which is a 21% increase over the previous year's same period. For H1 2024, income from placement reached to QAR 96.4 million. Profit on sukuk investment reached to QAR 52.6 million, and fee and dividend income reached to QAR 48.4 million. Total assets stood at QAR 7.5 billion as of 30th June 2024, up by 47% compared to the previous year of QAR 5.1 billion. Additionally, the bank investment reached to QAR 3.2 billion, up by 21% from QAR 2.7 billion on 30th June 2023. The total customer deposit reached to QAR 3.7 billion by H1 2024, which is 20% year-on-year increase. The bank equity increased to QAR 1.3 billion from QAR 1.2 billion on 30th June 2023. Furthermore, we will just provide some high-level ratios. The return on average equity was 8.65%, while the return on average assets stood at 1.57%. The book value reached to QAR 1.13. EPS is QAR 0.097 and the capital adequacy is 15.69% as of 30 June 2024. In terms of the total assets under management, we are at QAR 6.7 billion, marking 12% year-on-year growth. So this is the high level snapshot, which I gave you -- if so we can just go to question and answer, if anybody has any questions, please.

Thank you. We will now begin the question-and-answer session. [Operator Instructions] Your first question comes from the line of Alessandra David with Ashmore.

I just wanted to ask about your capital adequacy ratio. It's gone from 19.5% to 15.7% as of the first half of this year. If you could maybe just explain some of the factors behind that, that would be really helpful. That's my first question. My second question would be, if you could give sort of a more general outlook for the rest of the year. What you're seeing in terms of demand across the industry and maybe give some guidance as to where you see performance as of the full year.

Your first question from our -- I heard it, but your voice is very low. If you don't mind, can you repeat your second question?

My second question was about the outlook for the industry and your business for the rest of the year. If you could give some guidance, any KPIs. That would be very helpful.

Thanks for asking the question. The capital adequacy, we are still within the required limit of regulator. But however, we have some significant investment during the quarter. That's why our capital adequacy has dropped. But still, we feel it's on a very adequate level, which is required as per the regulator. Second question regarding the outlook. So we still -- interest rates has not been changed at this moment, although we are expecting now the change. So all the banks, including the Lesha Bank, has enjoyed how much on the higher in profit rate margin or the interest rate margin. That's why our treasury income is quite high. On the other hand, everybody faced some decline in the real estate, and we also marked our real estate down in the last quarter of 2023. Still the market has not improved. But however, the yield on our real estate investment is the same. Nothing has been changed because all are back-to-back fully secured. So we believe that once the interest rates will change, the market, for especially for the investment bank's point of view, the -- whoever invested in the real estate, will improve and that will help. When it comes -- and definitely, we are looking for that the stock exchanges will also get better. Lesha Bank is trying to be more diversified. Now we have started even the advisory department before which we don't had and we have started the public equity also. So Lesha Bank overall, based on the economy and whatever we gain of the industry, we are changing ourselves also and trying to cover the more areas like advisory and public equity. When it comes to the [ our main ] and other investment side, which is the private equity, I think it's working well. We don't see any impact and it's improving. So please let me know if I answer your question. If still you have anything, please let me know.

[Operator Instructions] There are no further questions. I will now turn the conference back over to the moderator.

Okay. So if there are no more questions, we can wrap this up. Thank you, Tauseef, for giving us an update on the second quarter figures, and we'll pick this up again in the third quarter.

Yes. Thank you, everyone. Still if someone has any question, they can send us an e-mail or a separate call and we will be happy to answer. Thank you very much.

Ladies and gentlemen, that concludes today's call. Thank you all for joining. You may now disconnect.