Riyad Bank And Arab National Post Higher Profits - Gulf Business
Now Reading
Riyad Bank And Arab National Post Higher Profits

Riyad Bank And Arab National Post Higher Profits

Both Saudi Arabian lenders have seen their operating income rise for the third quarter.

Riyad Bank and Arab National Bank posted higher third-quarter net profits on Tuesday, as Saudi Arabian lenders benefit from expansionary fiscal policies, ample liquidity and improving corporate loan demand.

Bank lending to the Saudi private sector grew by 14 per cent in August over the same month last year, the Saudi Arabian Monetary Authority (SAMA) said in September, while some analysts see strong growth continuing for several years.

“It’s a good environment – businesses are doing well, balance sheets are robust. It encourages banks to lend,” said Robert Eid, the Arab National Bank chief executive.

A report by Credit Suisse in August predicted Saudi banks should deliver double-digit earnings growth for the next three years thanks in part to higher credit volumes.

Saudi banks have also mostly completed a period of strengthening their provisions against bad loans after the financial crisis and the multi-billion dollar collapse in 2009 of Ahmad Hamad Al-Gosaibi and Brothers, a major Saudi company.

Eid said he expected the good conditions for Saudi banks to continue in the fourth quarter and added that Arab National Bank was well-provisioned.

“We’re in a very sound position,” he said.

Riyad Bank, the kingdom’s third-largest listed bank by market capitalisation, said net income rose 5.8 per cent to 840 million riyals ($224 million) in the three months to September 30 compared with the year before, though this was short of analyst forecasts.

Ten analysts polled by Reuters had on average forecast profit of 860 million riyals.

Riyad Bank’s total operating income for the quarter rose 7.2 per cent to 1.69 billion riyals, while income from special commissions grew 5.0 per cent to 1.12 billion.

Its loans and advances were up 2.8 per cent.

Arab National Bank’s net profit rose 10.3 per cent to 573 million riyals, compared with 519 million in the prior-year period.

The lender said its total operating income for the quarter rose 3.6 per cent to 1.19 billion riyals, while its income from special commissions grew by 8.1 per cent to 846 million.

It added that its loan portfolio jumped 16.7 per cent to 83.7 billion riyals.

Both banks said only that increased total operating income had driven the rise in net profit and gave no further comment about what had driven their earnings in the quarter.


Scroll To Top