RIYADH, 19 October 2006 — Saudi Hollandi Bank (SHB) recorded a net profit of SR297 million in the third quarter of 2006, up 7.7 percent over SR277 million during the same period last year, according to SHB Managing Director Giel-Jan van der Tol.
The bank’s SR994 million operating profit for the first nine months of 2006 showed an improvement of 22 percent compared with the corresponding period of 2005. SHB’s net profit of SR663 million for the period ended Sept. 30, however, reflected a decline of 9.5 percent as against the first nine months’ result of last year of SR732 million. The 2006 first nine months net result was impacted by a one-off credit provision of SR274 million in the previous quarter. Excluding the one-off credit provision, the bank’s first nine months net result for 2006 would have been 28 percent higher than the same period last year.
Managing Director Giel-Jan van der Tol said: “Our business and product segments have performed well and carry good momentum into the fourth quarter”.
Total assets at Sept. 30 amounted to SR44.5 billion, an increase of 19 percent over the previous year, mainly attributable to loans and advances to customers that grew by 28 percent from SR20.6 billion to SR 26.3 billion. Customer deposits also grew by 28 percent reaching SR32.5 billion at Sept. 30 compared to SR 25.4 billion as at Sept. 30 2005, while the bank’s investment portfolio which comprises financial instruments denominated in riyals and dollars, increased by 2.4 percent to SR10.1 billion. As a result of the one-off credit provision in June 2006, net earnings per share for the first nine months of 2006 declined from SR3.32 to SR3.01, while return on equity was 23.2 percent (2005: 31.4 percent) and return on assets recorded 2.1 percent (2005: 2.8 percent).
SHB affirmed its prominent position in the Saudi investment banking sector. In August, SHB successfully closed the IPO of Red Sea Housing Company Ltd. This transaction was 5.6 times oversubscribed, having attracted more than SR3 billion in application funds from more than 4.6 million people. This was the first IPO where SHB acted as lead manager, lead underwriter, flotation manager and receiving bank.
This year SHB is celebrating its 80-year presence in the Kingdom making it the oldest bank in the country.
In April, the bank launched its new corporate logo and inaugurated its new landmark regional office building in Jeddah. Established in 1926, SHB operates 41 branches and 164 ATMs distributed over the Kingdom of Saudi Arabia. SHB is listed on the Saudi Stock Exchange and has 1,540 employees of which 85.3 percent are Saudi nationals.
The Dutch bank ABN Amro Bank NV, which founded SHB, owns 40 percent of its stock with the remainder being owned by Saudi investors.