Al Rajhi boosts loan loss provisions in Q1
Riyadh , May 1, 2010
Al Rajhi Bank, the biggest Saudi-based lender by market value, raised provisions against loan losses by 24.5 per cent during the first quarter, though these were still at their lowest level in four quarters.
Bourse data showed that Rajhi set aside 358.9 million riyals ($95.7 million) in impairment charges for loan losses during the three months to March 31, against 288.4 million riyals a year earlier.
The Saudi bourse's website did not explain what these provisions were for.
On Wednesday, bourse data showed that Samba Financial Group and SABB, two of Saudi Arabia's biggest lenders, booked additional provisions against loan losses during the first quarter following a surge in bad loans last year.
Profits at most Saudi banks declined during the first quarter due mainly to a decline in lending income.
This came after a difficult 2009 when Saudi lenders' profitability was eroded by provisions to counter exposure to a pair of troubled Saudi firms, as well as flat credit growth in the wake of the global financial crisis.-Reuters