RIYADH, 21 July 2007 — Saudi Hollandi Bank (SHB) has reported a net profit of SR381.9 million for the six months ended June 30, 2007 compared to SR364.9 million for the same period last year, an increase of 4.6 percent.
In a statement issued here, Jan Koopman, acting managing director of SHB, pointed out that the board of directors approved an interim cash dividend of SR0.71 per share. He added that this dividend payment equals last year’s interim dividend adjusted for the bonus share issue that took place early this year.
The bank’s total assets grew by 10.8 percent from SR44.4 billion as on June 30 last year to SR49.2 billion for the same period this year. Shareholders’ equity grew by 22 percent from SR3.8 billion to SR4.6 billion during the reporting period, while the return on equity went up from 17.3 percent to 19.7 percent. Return on assets for the first half of 2007 stood at 1.6 percent versus 1.7 percent in the first half of 2006 while earnings per share jumped by 4.3 percent from SR 1.38 last year to SR1.44.
The loan portfolio showed a slight growth to SR26.2 billion compared to SR25.9 billion last year. In line with its prudent credit provisioning policy the bank further strengthened its provisions for doubtful debts.
Customer deposits increased by four percent to SR33.7 billion compared to SR32.4 billion last year. The net special commission income for the period went up by four percent to reach SR586.1 million compared to SR561.8 last year. The total operating income, however, declined by 13.7 percent to SR860 million from SR997 million as during the first half of 2006. The decline has been attributed to a drop in the fees from banking services.
Meanwhile, the operating expenses surged from SR315.8 million in the first half of 2006 to SR349.4 million for the corresponding period this year, representing an increase of 10.6 percent due mainly to increased staff and marketing costs.
Koopman added that the bank executed during the first half of this year a number of strategic initiatives, such as opening a private banking office in Jeddah and expanding the preferred banking lounges in the branch network.
He said that in line with the CMA regulations, the bank is consolidating its investment banking and corporate finance activities into a fully owned subsidiary, SH-Capital. Also, the bank acted as mandated lead arranger for the largest-ever Islamic financing package for Mobily.
Established in 1926, SHB operates 41 branches and 171 ATMs distributed all over the Kingdom. The bank is listed on the Saudi Stock Exchange and has 1,534 permanent employees, of which 86 percent are Saudi nationals. The Dutch bank, ABN Amro Bank NV, which founded SHB, owns 40 percent of its stock, while Saudi investors hold the remained.