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SABB Q4 profit down 3.1pc, misses forecasts

DUBAI, January 18, 2016

Saudi British Bank (SABB), the kingdom's fifth-largest bank by assets, posted a 3.1 per cent drop in fourth-quarter net profit on Monday, missing analyst forecasts as expenses rose.

The bank, an affiliate of HSBC Holdings, made a profit of SR939 million ($250.53 million) in the three months ending December 31, compared with SR969 million in the same period a year earlier, it said in a bourse filing.

Five analysts surveyed by Reuters had forecast the bank would make a quarterly profit of SR1.04 billion.

SABB attributed its drop in net profit to a 5.2 per cent rise in operating expenses after it took bigger provisions for credit losses and salaries and other expenses increased. The Saudi lender's total quarterly operating income fell 0.9 per cent to SR1.55 billion, which contributed to its profit decline.

Saudi companies issue brief earnings statements early in the reporting period before publishing more detailed results later.

SABB chairman Sheikh Khaled Olayan said the solid financial results reflect the bank's consistent focus on revenue growth and risk management in line with its strategic objectives.

"The customer satisfaction levels and industry awards reflect our leading international bank position. SABB’s strong capital and liquidity position, together with strong credit ratings, continue to support our growth strategies and our ability to enhance shareholder value as business opportunities arise," he noted.

The kingdom's banks are contending with weaker credit growth because of lower oil prices, although heavy government spending has helped offset the impact, he added.

Fourth-quarter profit from special commissions rose 1.1 per cent year-on-year to SR1.08 billion.

Saudi lenders' net interest income has weakened due to subdued loan growth and fierce competition, especially in the retail market.-Reuters




Tags: Saudi | SABB | Bank |

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