July 16, 2014 / 8:47 AM / 3 years ago

UPDATE 1-Kuwait's NBK Q2 profit rises 29 pct, misses estimates

* Q2 net profit 60.9 mln dinars; forecasts were for 74.8 mln

* H1 net profit 144.8 mln dinars, up 12.6 pct

* CEO says operating environment improving

* Assets up 11.7 pct y/y, down 2.5 pct q/q (Adds detail, context)

DUBAI, July 16 (Reuters) - National Bank of Kuwait , the Gulf Arab state’s largest commercial lender, reported a 29 percent rise in second-quarter profit on Wednesday but missed analysts’ estimates.

Net profit climbed to 60.9 million dinars ($215.8 million) in the three months to June 30 from 47.2 million dinars a year earlier, according to Reuters calculations based on the bank’s first-half financial statement.

However, the result was well short of the 74.8 million dinars average forecast of analysts in a Reuters poll.

For the first half of this year, profit rose 12.6 percent year-on-year to 144.8 million dinars, the bank said, citing what it described as a continuing improvement in Kuwait’s operating environment.

“There is a noticeable improvement in the process of tendering, award and execution of the large infrastructure projects, which has also reflected positively on the overall private sector sentiment and accordingly on banks’ credit growth,” said Isam al-Sager, appointed NBK’s chief executive in February.

NBK’s loans and advances rose 9.6 percent year-on-year to stand at 11.3 billion dinars, the bank said.

That compared to a 6.2 percent rise in combined bank lending growth to the private sector in Kuwait during May, the slowest increase since September 2013, according to the latest data from the central bank.

Loan growth helped boost NBK’s total assets to 20 billion dinars on June 30, up 11.7 percent on the same point of 2013. However, compared with the end of March, assets fell 2.5 percent, according to Reuters calculations.

Kuwait’s long-delayed 30 billion dinar economic development plan, announced in late 2010, has been hindered by political infighting and chronic bureaucracy.

In recent months there have been signs that some economic projects are gaining steam, though political tensions have continued to weigh on the stock market, causing it to underperform markets in other rich Gulf states. (Reporting by David French; Editing by Andrew Torchia)

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