Saudi Al Rajhi Bank, SABB report double-digit Q3 profit growth

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Time: October 24, 2018   

DUBAI: Al Rajhi Bank and Saudi British Bank, two of Saudi Arabia’s largest banks, reported double-digit third-quarter profit growth on Wednesday, broadly in line with forecasts.

Al Rajhi Bank, the kingdom’s second-largest lender by assets, reported a 13.6 percent climb in its third-quarter net profit, helped by a rise in net special commission income and fees from banking services.

The bank made 2.57 billion riyals ($685.2 million) net profit in the three months to Sept. 30, up from 2.27 billion riyals in the same period a year earlier, it said in a bourse statement.

The average forecast of three analysts polled by Reuters was a net profit of 2.60 billion riyals.

After its loan book shrank in the second quarter, the bank posted a small return to lending growth in the third quarter, up by 0.5 percent to 234.43 billion riyals.

Chief executive Steve Bertamini told Reuters in August the bank expected to return to more “normalised” mid-single digits in loan growth in 2019 as it anticipates opportunities surrounding Vision 2030, a multi-billion dollar drive to open up society and diversify its economy away from oil revenues.

Saudi British Bank (SABB), the sixth-largest bank by assets, posted a 15.1 percent rise in its third-quarter net profit to 1.25 billion riyals for the quarter. That was up from 1.08 billion riyals for the same period of last year.

The average forecast of three analysts polled by Reuters was a net profit of 1.24 billion riyals.

The performance was boosted by a climb in net special commission income and a fall in total operating expenses, mainly due to a drop in provisions for credit losses.

SABB, 40 percent owned by HSBC, is merging with Alawwal Bank to create the kingdom’s third-biggest lender with a market capitalisation of about $17.2 billion.

SABB’s loans and advances stood at 112.13 billion riyals at the end of September, down by 3.9 percent from the same period last year.

($1 = 3.7509 riyals)

This article was first published in ZAWYA

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