Five major Saudi banks post strong Q3 profits
Three major Saudi banks beat analyst forecasts; Rising profits due to lower costs, increased income; Banque Saudi Fransi, SABB Bank miss forecasts
October 13, 2011 10:32 by Precious de Leon
Five major Saudi banks posted third-quarter net profits, three of which beat analysts forecasts, citing lower operational costs as well as increased income from banking fees and investments, the lenders said on Wednesday.
Saudi Arabia’s biggest Islamic Bank, Al Rajhi Bank posted an 18-percent rise in its third-quarter net profit to 1.9 billion riyals ($506 million) from 1.6 billion, attributing the rise in profit to higher revenue from banking fees and investment income.
Al Rajhi’s operational profit rose 7.6 percent to 3.2 billion riyals from 2.97 billion riyals a year earlier.
Analysts, surveyed by Reuters, had expected the bank to post an average third-quarter net profit of 1.8 billion riyals.
Another lender, Saudi Hollandi Bank saw its third-quarter net profit more than triple to 299 million riyals from 85 million, after it lowered its operational costs, the bank said.
Analysts polled by Reuters expected the bank to post, on average, a third-quarter net profit of 244.5 million riyals.
Saudi Hollandi, the kingdom’s oldest bank, had a 5.1 percent rise in its profit from special commissions to 359.8 million riyals but its operational profit dropped 0.6 percent to 521 million, it said.
Meanwhile, Aljazira Bank tripled its third-quarter net profit to 66 million riyals, up from 22 million during the same period a year ago, citing lower operational costs.
Five analysts in a Reuters survey expected the bank to post, on average 55 million riyals in net profit for the third quarter.
SABB Bank posted a 50.4-percent-rise in its quarterly profits but still missed analyst forecasts. SABB made a net profit of 630 million riyals in the third-quarter, compared with 419 million riyals in the same period a year earlier.
The lender cited lower operation costs for its rise in profits.
SABB’s income from special commissions dropped 1.6 percent to 787 million riyals in the third-quarter from 800 million riyals in the same period a year earlier, while its operational profit rose 4.5 percent to 1.2 billion from 1.16 billion, it said.
The fifth bank, Banque Saudi Fransi missed analyst forecasts after it posted a 22-percent-rise in its quarterly profit. It made 760 million riyals in the third quarter, compared with 621 million riyals in the same period a year earlier.
Analysts surveyed by Reuters expected the bank to post a third-quarter net profit, averaging 766 million riyals.
Saudi Fransi’s operational profit rose 7.4 percent to 1.2 billion riyals from 1.1 billion riyals a year earlier and its profit from special commissions rose 3.9 percent to 808 million riyals from 778 million riyals. (Reporting by Asma Alsharif)