Hello, and welcome to Qatar Islamic Bank. Please note that this call is being recorded. You will have the opportunity to ask questions to our speakers for today later on during the Q&A session. If you would like to ask a question by that time, please press star then the number one on your telephone keypad. I'd like to hand the call over now to our moderator. Shahan, please go ahead. Thank you, and hello everyone. I want to welcome you to QIB's first quarter 2026 financial results conference call. On this call from management, we have Gourang Hemani, the Bank's CFO. Vinay Balakrishnan, Head of Business Reporting and Budgeting, and IR Officer. 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 Vinay. Please go ahead. Thank you, Shahan. Good afternoon, everybody, and welcome to Qatar Islamic Bank's Q1 2026 results call. Qatar Islamic Bank yesterday announced financial results for the first quarter of 2026. Net profit attributable to the shareholders amounted to QAR 986 million for the quarter ended 31st March 2026, which is at the same level as compared to the quarter ended 31st March 2025. Total assets of the bank have reached QAR 224 billion, representing a growth of 5.9% versus the first quarter of 2025, and 1.3% against December 2025. Financing and investing activities continued to be the primary drivers for the asset growth. Financing assets have reached QAR 146.4 billion, having grown by 11.1% compared to 31st March 2025 and 5.7% compared to 31st December 2025. Investment securities have reached QAR 60.7 billion, having grown by 14% compared to 31st March 2025 and up marginally against 31st December 2025. Customer deposits stands at QAR 140.7 billion, registering a growth of 5.4% compared to 31st March 2025, but marginally down by 1.4% against 31st December 2025. Financing to deposit ratio was 95% as at 31st March 2026 compared to QCB maximum requirement of 100%, reflecting the bank's strong liquidity position. The net operating income of the bank after deducting net profit attributable to Quasi-Equity holders is QAR 1.6 billion, which is at the same levels of Q1 of 2025. Total operating expenses of the bank was QAR 277 million for the quarter ended 31st March 2026, which is higher than 33.1% as compared to Q1 of 2025. Strict cost control measures have helped to keep the cost income ratio at 17% for Q1 of 2026 compared to 16.6% for Q1 of 2025, which continues to be the lowest in the Qatari banking sector. On the asset quality front, QIB was able to manage the ratio of non-performing assets to total financing assets at 1.56% and maintain a healthy coverage ratio for non-performing financing assets to 95% as at 31st March 2026. The bank has continued to build up impairment provisions of QAR 236 million in the Q1 of 2026 compared to QAR 247 million in Q1 of 2025. The bank was able to improve its Stage 2 financing coverage ratio to 9% as of 31st March 2026 against 8.5% as of 31st March 2025 and maintaining its Stage 1 coverage ratio at 3%. These actions taken by the bank reflect the bank's strong risk management framework as well as a conservative provisioning policy. The bank is closely monitoring the evolving geopolitical situation and is undertaking ongoing assessments to evaluate potential implications on its operations. The capital adequacy ratio of the bank computed under the Basel III guidelines issued by Qatar Central Bank is now at 22.9% as against 22.2% as at 31st December 2025. Having taken you through the key highlights of the financials, we can now go on to the Q&A session. I'm handing over to Shahan. Thanks. We can now go to Q&A please. Thank you so much, Shahan. At this time, I would like to remind everyone that in order to ask a question, press star then the number one on your telephone keypad. We will pause for just a moment to compile the Q&A roster. Okay, your first question comes from the line of Jon Peace with UBS. Your line is open. Hi. Thank you. I just wondered please if you had any updates to your guidance. I think at the beginning of the year you were hoping to see financing and revenue growth of around 5%-6% alongside a flattish NIM and cost-to-income ratio around 16.5%-17% level. How do you feel about those now? In particular, how do you see the cost of risk? Do you think you'll be able to use your high level of Stage 2 provisions to manage that to be relatively consistent this year? Thank you. Good day everybody. Gourang Hemani here, the CFO of the bank. In terms of the guidance, I think we continue to believe that, thankfully, we have achieved in terms of the balance sheet growth, et cetera, a large part of the growth that we had forecasted has already been achieved in the first quarter. Our financing growth, excluding the acceptance bit of it, so the real financing book has grown by roughly around 4.75% for the year. Compared to March of last year, it's grown almost 5% compared to the headline number, which is about 6%. Overall, I think the balance sheet growth we have achieved quite decently. We may expect some slowdowns as we keep going into the year, but that should still put us in line with what we expect to achieve in terms of the balance sheet growth, in terms of the overall funded income growth. I think as of now, we have seen a bit of the impact in the Q1 that came because of the cost of funds. We continue to remain prudent and continue to maintain high liquidity, in this scenario, slightly impacting our cost of funds and a bit of the NIM. We believe that this is more transitory, and as things normalize, we should be able to continue to maintain what is our annual forecast. However, it's still a very evolving situation, and we'll keep monitoring. I think as we go into Q2, end of Q2 kind of a scenario, we'll have a much more clarity. In terms of cost of risk, as we have mentioned that we have been very well adequately provided. However, if you have seen that, given the fact that all the uncertainties that are prevailing, we continue to remain prudent, and we have again built provisions in the first quarter of the year, marginally below the last year levels. We thought it is prudent to continue to build. I think we built financing provisions of QAR 236 million in the first quarter compared to QAR 248 million last year. Almost in line with the previous year, marginally lower. I think we continue to remain a very conservative bank. We want to continue to make sure that we don't want to impact the profitability. As we get closer to the year, the asset quality impact will become much more clearer as we go into Q3, Q4. Far, we've not seen any major impact. There were certain initiatives taken by the Central Bank in terms of the payment deferrals for three months, et cetera. We've not seen a big number of customers approaching us so far. So far it looks to be fairly well managed. We'll keep evolving. I think the cost of risk is something that we'll get a better clarity as we get into Q3 and Q4, but we remain prudent and conservative at this point of time. Thank you. Hope this answers your query. Yes. Thank you. Thank you. Your next question comes from the line of Chira Ghosh with SICO. Your line is open. Hi, this is Chira Ghosh. Can you hear me? Hi, [Chira]. Yeah, hi. I have three very quick questions. First one is, it looks like the NIM pressure has still continued. Last quarter, you were saying that it's primarily related to the acceptances, and excluding acceptances, the NIM is still reasonably resilient. If you can again tell us where does it stand, excluding the acceptances part in first quarter? That will be my first question. Also if you can give us some guidance on the NIM sensitivity for a 25 basis point NIM movement, where you stand. That is my first question. Second is fee income appears to have been a little weaker than what we were expecting. If you can give some color on why is that happening. Third is again, a little continuation on the previous question is purely on the loan book side of it. Are you seeing any pressure basically tapering demand from the client side? Lower demand from the borrowing side? Yeah, these are my three questions. On the NIM side, as I said, if I look at my Q1 financing minus deposit NIMS, excluding acceptances, it came to roughly around 3.2%, almost in line, I think maybe marginally less than one basis point impact out there. Can somebody put on their mute, please? I see a lot of background noise coming. Thank you. Yeah. In terms of the overall NIMS, I think there was an overall reduction by one basis point, but that's purely because of the fact that we decided to, say, pay a little bit more higher in this scenario and to continue to manage strong liquidity positions. I believe that's more transitory in nature. Overall, the NIMS have been stable with vis-à-vis Q4 of last year. In terms of the fee income, yeah, they've come marginally lower. I think a lot of it has got to do with the fact that with almost one month of lower economic activities, especially in the international spending bit of it, et cetera. That has been a bit of an impact on the fee side of it. I think some of it also in terms of the financing book, et cetera, the upfront fee has come slightly lower. I think a lot of that is got to do with the fact that we are in a bit of a scenario where the economic activities have been a bit slower. Once things normalize, we expect them to pick it back all over again. In terms of loan book tapering demand, I think we just finished the quarter, as I explained to you that we have seen our loan book, excluding acceptances, has grown by 4.75%, 4.74% compared to December, which is a very, very healthy growth I can tell in this market. I think, if you ask me personally, our Q1 growth has been higher than what we were expecting to happen. A lot of it is carry forward of what was there in pipeline last year. We'll keep seeing, we'll keep monitoring. As I said, our targets, we still maintain the growth target of 5%-6%, so I think we are well in line with that. Just a follow-up question, sir. International deposit outflow? There has been hardly any international deposits outflow that has happened compared to what we have seen before. Most of the deposits have been renewed. If I can put a number to it, our total deposits at the end of Q1 was 13% outside the country as compared to 12% at the end of December. Our Non-Resident Deposits share has actually gone up from where it instead of being down compared to December. Chira, there's a lot of noise in your background. You need to keep muted when you're not questioning. Okay. I think, okay. That's all from my side anyway. Thank you. Thank you. Your next question comes from the line of Murad Ansari with GTN. Please go ahead. Yes. Hi, good afternoon. Thanks for the presentation. A few questions. I'm sorry, I joined a couple of minutes late, so might have addressed a couple of points here already. Firstly, on loan growth, so you're saying acceptances is about 4.75%. That's roughly about QAR1.6 billion-QAR1.7 billion in this quarter, that's incremental, that's come in, if you could confirm roughly the number. Would that be again, reflected in the retail portion of the book? Because that's also increased versus the last quarter. That's my first question. Second question is- Murad, just let me answer on that one. It's QAR6.6 billion growth excluding- QAR1.6 billion? QAR6.6 billion. Sorry. It has grown from QAR140 billion-QAR146 billion, excluding acceptances. It's a QAR6.6 billion growth, not QAR1.6 billion growth. No, I understand. I said that the acceptances bit that has increased- Yeah, that's QAR1.6 billion. Yeah. Yes. Yeah. That would be reflected within the segment split in the retail part of the book. Would that be correct? No, that would be- Or would that be- That would be sitting in the commercial bit of it. We've seen some growth on the retail side as well. If you could just maybe give us a high-level overview of what you think have been the drivers there, and is this more sustainable? The personal banking book has grown by roughly around QAR1.2 billion, which is like a normal growth that we kind of achieve. We usually tend to see a larger growth at the beginning of the year. The personal banking book has grown by QAR1.2 billion. The rest of it is all coming from different segments, including contracting has been almost flat. It's real estate, commercial services, et cetera. It's a mix of different loan book segments. All right. Just on these acceptances, if I remember correctly, I think you mentioned last quarter as well that these are generally the acceptances growth are also matched by deposits. The current account increase, is that also a reflection of these acceptances? Current account is operating account, so the deposits would be sitting in what we call the Quasi-Equity. That's where- Okay ... it sits. They would be sitting more, if you look at our maturity profile, you will see that they're all sitting predominantly in over three years category deposits. These are predominantly those deposits. All these deposits are taken by the bank on a very timely basis, with a seven-year maturity, helping the bank significantly have a very stable non-resident funding book. That's all I can say. All right. Thank you so much for that. Just before that, on the deposit side, you've raised $750 million in February. Yeah. When we look at your deposit split, there has been a decline in your term deposits, increase in your current accounts. Any leakages here? Did you consider reducing your term deposits because of the Sukuk inflow? It's a combination, right? When you are managing the funding, you don't look at it on a silo basis or a product basis, right? You look at the- Yeah Overall funding profile of the bank. We had a very healthy growth in the current accounts, which are the low-cost deposits, so that gives you an opportunity to pay off expensive deposits. A lot of the Sukuk funding was eventually used also to fund the loan book, that loan growth that had happened in the first quarter. The remaining was used to pay back deposits. We paid back some of the short-term NRDs through using the Sukuk funding as well. Great. Last question is, you might have mentioned this at the start, just on the taxation front. You restated the last year's provision into tax, and you split that up, and this quarter you've booked a tax charge. Can you help us get a view on how this is going to progress? My understanding would be that you'd be applying for an exemption on the GMT rules for transition period. Is that correct? It is. How long could that take? Just to say that, beginning of this year they published the final executive guidelines where they have said that everybody has to pay a Global Minimum Tax, unless they've given the authority to the Minister of Finance to come out with an exemption, if it is. As of now, we are not aware of any exemptions that are in the pipeline or planned or nothing has been announced yet. We will continue to build the tax base as if we have to pay the taxes. I really would not like to comment whether those exemptions are going to come or not going to come. Given the fact that there is no official announcement from the Ministry of Finance under the signature of His Excellency Finance Minister, we assume that we are taxable and we continue to build taxes. The only way out would be for any entity, at this point of time, is if you are able to restructure your businesses, et cetera, whereby you come out of the taxation guideline, which effectively means you do not have any international presence. Only in this scenario, you don't pay taxes. All right. Okay. Thank you so much. That's all. Your next question comes from the line of Rahul Rajan with Bank of America. Your line is open. Yeah. Hi, good afternoon. Thanks for the call and for taking my questions. A few quick questions from my end. Firstly is, on the Central Bank measures, you mentioned that a lot of clients have not really come forward for the deferral, at least until March. Could you also highlight some of the other aspects of the measures in terms of liquidity or in terms of lower capital requirements or some of the other measures, which QCB has announced and how it sort of positively or negatively affects your business? Until when do you think these measures, at least the ones which have been announced now, until when are they applicable? That's number one. Secondly is, on the credit growth perspective, you mentioned, you would still stick to the 5%-6% loan growth sort of a target, and we're already at around 4.7% if you exclude the acceptances. Which means, from now until the end of the year, next three quarters, it's not really a lot of growth or flat-ish. Why do you think so? Or do you expect more repayments? Is there any specific sector on that sense? And lastly is, on the post-war scenario, how do you see credit growth evolving? Maybe based on government spending, based on certain industries. Is there certain industries from whom you think there would be a stronger credit growth? Yes, those are my three. Thank you. Okay. Okay, now the first one, there are two, I would say two primary central bank measures that have been announced. First of all being the three-month relief or moratorium being given to impacted customers. That's one. As of now, it's just a three-month announcement, so unless and until the central bank comes with a revised guideline, we will assume that it remains at what has been announced. The second big measure that has really helped the banking system is a reduction in the reserve requirements by 1%. That has really helped improve the Qatari riyal and dollar liquidity in the system. Also basically coming and will have a positive impact on the bank's profitability because these were all, let's say, profit-free placements or the reserves that were there with central banks. That also has a bit of a benefit. Other than that, it's more about guidelines and communications and the monitoring of the positions by the central bank across the system to see where the impacts are, et cetera. Fortunately, from what we have been seeing so far and what we've been discussing, I think the primary concern in these situations is on the liquidity. So far the liquidity positions have been holding up, especially on the international funding side of it. We're not seeing much impact coming from there. Credit growth, I agree with you that I've put 4.75%. I don't want to change any guidance because I think we are in a period of a bit of uncertainty. If things come back very quickly to normalcy scenario, I think we can see a better coming from anybody rather than more repayments coming. I think it's just that all I can say is I don't have enough information at this point of time as to when this uncertainty would end and what would be the post-war scenario looking like for me to be able to comfortably come and give new guidelines. I think maybe end of Q2 we might be in a better position, and that's the only reason we are not changing our guidelines. No reason whatsoever anything else. I think on the third scenario, very difficult to put a comment in terms of where do I see the post-war scenario coming in, where the growth could come in. I think a lot of it would depend upon how the public sector guidelines and the government guidelines change in terms of what their priorities are going to be and how does it have an impact going forward. I would refrain from commenting on what scenarios would be because I don't have enough information at this point of time to really be able to make any conclusive comment on this. Sure. Very helpful. Just one follow-up please. In terms of exposures, what would be the sort of exposure to some of the segments which are impacted? I see construction real estate is mentioned separately but apart from that, say, the likes of travel tourism or some of the other hospitality-related sectors or some of the other sectors which you think are more impacted during this time. What would be the kind of exposure and the coverage ratios for those sectors? In a sense, yes. What you are mentioning in terms of the tourism and retail segments are the ones that are the other ones where especially the hotels and all would be there. Fortunately, I think we also saw a bit of a lull coming in post-FIFA World Cup, et cetera, where the hotel occupancies had gone down, et cetera. We saw that the sector came out quite successfully out of it. I think these are more short-term impact. I really don't think so that there is going to be a major impact. Unlike some of the regional countries, I think while tourism and all are important to the sector, but I think they do not carry that much weight vis-à-vis some of our, let's say, other regional countries which are more heavily dependent on tourism and other things. I would say it is an area that we will continue to keep looking at it, both, I would say, hospitality and the retail side of it. As of now we are not significantly worried. I think domestic retail demand continues to remain fairly strong. As of now, we've not seen any major impact on the employment sector, employment of expatriates, et cetera. We've not seen any major actions coming in. I think a lot of it is going to depend upon how long this is going to last and how quickly the bounce back is going to happen. I think still in the early phase, I think we need to cross the bridge to really be able to get an assessment of what is the medium term to longer-term impact. As of now, as I told you, not very many customers have approached us to do any deferral. I think so far so good. That's all I can say. Thank you. Your next question comes from the line of Olga Veselova with Bank of America. Please go ahead. Thank you for hosting this call. I have two clarifying questions. One is on interest rates on deposits. During Q&A, you mentioned that you pay a little bit more On deposits. What was the magnitude of interest rates increases in the first quarter, maybe in April as well? My second question is on Central Bank support measures. This lowering reserve requirements by 1 percentage point, were they also lowered, or are they also lowered for three months? Or is this until further notice? Thank you. Well, on the interest rates paid on the deposits, there's no major increase in the interest rates paid on the deposits because the domestic liquidity is still the same. We've not seen a major outflow. What I mentioned was the fact that we tried to keep excess liquidity with us, and that has a negative carry impact that has got an impact on the NIM rather than increase in the cost of deposits. We've not seen any major increase in the deposits. I think all banks are prudent in the system to make sure that there are enough liquidity windows also available with central bank in terms of the repo and other facilities, so that even if there are any bank facing shorter term liquidity issues, you have access to funding rather than pushing up the overall cost of funds. It's more about negative carry from surplus liquidity you carry rather than cost of deposits. In terms of the reserve requirements, there is no timeline. These are not timeline-driven. Central Bank has the prerogative to increase or decrease the reserve requirements as and when they want. As of now, they have been reduced without any indication of when they were going to be increased back again. Mm-hmm. Got it. Thank you so much. Thank you. Your next question comes from the line of Ali Alnasser with Vergent Asset Management. Please go ahead. Hi, Gourang. Thanks for the call. I'm asking questions on behalf of my colleague, Dan. Sorry if this may have been discussed, but in terms of just explaining the loan growth, in Q1 and the pricing on that, because the observation is it appears the pricing on that is kind of lower than what the exit rate was in Q4. Is that the right conclusion to draw? And if so, can you comment on why pricing would be soft on that book? Well, the pricing softening compared to Q4 of last year, and this is more what has to do with how the repricing of the rate cuts happen because it doesn't happen. It is not an instantaneous cut in the rate. Similarly, if you look at it, the cost of funds also don't come down instantaneously. It's all about maturity and repricing profile. The new booking has not been done at, let's say, I would say a significantly lower rates than what have been done in the past. Maybe depending on the asset quality or the underlying credit risk you do price it up and down. Sure depending on the party, but it is not a generic, I would say, a comment that the asset growth has come at a lower rate. Hope that answers you. Okay. That suggests that if you think about NIMS for the rest of the year, and if you were to think about the idea that the central bank has lowered the reserve requirements by 1%, which you can deploy now, how do you think about NIMS for the rest of the year? As I said, as of now, it looks. Difficult, as you say, yeah. We should be able to hold the NIMS. I wish I had a crystal ball and I could predict. Yeah. No, of course. I appreciate that. As of now, as I said, so far the cost of funds have really not gone up. We really don't expect any major interest rate cuts in this scenario. We expect the financing book to continue to hold the yields. Based on that, we believe our NIMS should continue to remain stable. If the liquidity improves or deteriorates dramatically, then it could be a different scenario. I think if we have looked at almost 45 days, more than 45 days have passed, and I think we are in a comfortable situation at this point of time, so I don't see it further worsening. Yeah. Now that we are much more better prepared, we see a lot more international deposits starting to come back. Some of the even longer-term deposit players. I'm sure if you are monitoring the market, if you look at it, there have been significant transactions on the capital market, but more on a private placement basis rather than public side. You have sovereigns like Qatar, Kuwait, Abu Dhabi, they've all gone into the market. National champions in almost every country like QNB, FAB, ENBD, Al Rajhi, they've all gone into Senior or even in the Tier 2 space. I think if you look at it, yes, is international funding as easy as it was prior to the war, no. But has it completely dried up? I would say no. If I take a quick count of it, I think in the last 45 days or so, there have been more than $10 billion-$15 billion raised on the capital markets by the GCC sovereigns and the banks. Yeah undershooting the number, but I think it will be. Yeah more than that. I think everybody understands that the overall economies remain very strong. It is a bit of short-term challenges which will be overcome, but I really don't think so it really impacts the medium term to long-term outlook of the region in general. Fair or Qatar. Yeah. Okay. I get you. Makes sense. On the fees point, appreciate what you said about March being, for obvious reasons, quite soft, but there's a clear disconnect between the loan growth that you've achieved and the direction of fees and commissions. Would you say most of the fees and commission softness would have come from non-loan related activities? To explain that. Yeah. Okay. Yeah. Okay. And plus also- just payments and things like that. plus also a bit on the lending side as well, because not every lending does command a fee, et cetera. It's a- Mm. I would never look at fees in isolation or at least at the financing book of it, because sometimes it's always about the all-in pricing when you take the fee as well as the rate that you charge for the customers. Yeah. Yeah. I appreciate that. That makes sense. Last one is on the tax rate. Sorry, I know you answered this already, but you're expecting the same tax rate as you already realized in the financials in Q1. Is that right? Yep. We will continue to bill unless and until some announcement comes. Mm-hmm. We presume that we will have to pay taxes for this year as well. Clear. That's about 11.5%, is that right? Something around that, yeah. Yeah. Okay. Super. Thanks a lot. Good luck with the rest of the year. Thank you. Your last question comes from the line of Murad Ansari again with GTN. Please go ahead. Yes. Thanks for taking the follow-up. Just on the acceptances bit, do you see this as, because when we saw that in the fourth quarter last year, I thought it was more of one big, kind of a one-off kind of transaction, but that's kind of continued into first quarter as well. Do you see that as something that will continue to grow over the course of this year? Just from a readability perspective, would you consider splitting it out from your loan book in the financials to show it separately from the loan book just to have industry? Thank you. Murad, in a sense, the acceptances are purely dependent on the fact that first we get the deposits, longer term deposits, and then we issue acceptances against those, right? I'm sure you understand that there's been a bit of, with all these geopolitical challenges that are there has been a bit of slowdown. We look into it. We are not, again, also going to overly rely. We saw some growth coming back in this segment. There are various set of niche depositors who we deal with strong liquidity and a strong business model in this format. We might see something growing, but it will be slower. I think once the geopolitical situation evolves, you might see them coming back more, but till that point of time, it will continue to remain slow. In terms of showing it separately, I think if you look at it's kind of giveaway, if you look at my other liabilities growing up by similar context as well. We will look into it. I think maybe we will try to see if we can put a note or something like that to clearly highlight how much the acceptances are. I still will have to classify it as a financing because that's how the central bank disclosure requirements work out here. Your point is taken- Thank you so much. We'll see how we can improve the transparency, but this will have to be taken in line with auditors and how they look at it across the disclosures across the sector, right? It's not a QIB specific disclosure. Sure It's across the segment. I think we'll try to see what we can do to improve the readability. Again, it's something that not completely within what the bank can do in isolation. It'll have to be coordinated with the auditors who will have to coordinate across the entire system, across the banking system in Qatar. Great. Thank you so much. However, we are very transparent and when we come to these Investor calls, we are very clearly highlighting what the growths are excluding and including. Yeah? Yes, sure. Yeah. Thank you for that. Thanks, Murad. Thank you everyone, and that concludes our Q&A session for today. I will now turn the call back over to Shahan. Thank you. All right. If there are no more questions, we can wrap up this call. I'd like to thank management for giving us an update on the results, and we will pick this up again in the coming quarter. Thank you. Thank you, Shahan. Thank you, Gail. Thank you Shahan, thank you Gail for organizing the call. Thank you very much. Thank you. Have a nice day ahead. You may now all disconnect. Thank you again.