A branch of Qatar National Bank in Riyadh, Saudi Arabia. Losing foreign business links could be uncomfortable for Qatari banks as they expanded their loans faster than other banks in the GCC. Image Credit: Reuters

Dubai: Qatar National Bank QPSC said its assets have passed the 1 trillion-riyal ($273.5 billion) mark and it set aside more money in provisions as a "precautionary measure."

The Middle East's biggest bank booked 5.8 billion riyals in loan-loss provisions, compared with 3.18 billion riyals a year ago, according to a statement on Tuesday. Total assets ended 2020 at 1.025 trillion riyals, an increase of about 9 per cent  from the previous year.

Profitability for lenders in the Gulf remains under pressure from the coronavirus pandemic as disruptions to trade and travel continue to rattle the energy-rich region. The outlook for Qatar is turning more favorable following the restoration of its ties with Saudi Arabia, the United Arab Emirates, Bahrain and Egypt after a diplomatic breakthrough this month ended a three-year dispute.

"The bank continues to provision for Covid-19," Citigroup Inc. analysts Rahul Bajaj and Ronit Ghose said in a research note. "While QNB has reported weak headline numbers, we do note that that the bank continues to perform strongly on a pre-provision basis."