Qatar National Bank (QNB), the largest lender in the Middle East, has reported a 12 per cent year-on-year increase on profits in the first half of 2016, to QR6.2bn ($1.7bn).

QNB’s assets grew 36 per cent to QR692bn over the last year, partly thanks to the acquisition of 99.8 per cent of Turkey’s Finansbank, completed in June.

This also drove loan growth, up 39 per cent year on year to QR497bn. Deposit growth lagged slightly, reflecting tighter liquidity in the GCC, but was still up 29 per cent from the same time in 2015, to QR488bn.

QNB’s loan to deposit ratio rose to reach 101.7 per cent, above regulatory limits which come into force in 2017. However, QNB is in a much healthier position than smaller Qatari banks. The non-performing loans ratio rose from 1.4 per cent to 1.8 per cent in the second quarter.

QNB issued QR10bn in additional tier 1 perpetual capital notes, and secured a $4bn syndicated loan to boost its capital. The capital adequacy ratio was at 14.2 per cent on 30 June, above regulatory requirements.

QNB is one of the first banks to release half-year results in the GCC. Other banking results are expected to be mixed, reflecting slowing economic growth and tighter liquidity.