Al-Rajhi Bank posts SR1.72bn net profit in Q3

Al-Rajhi Bank posts SR1.72bn net profit in Q3
Updated 12 October 2013

Al-Rajhi Bank posts SR1.72bn net profit in Q3

Al-Rajhi Bank posts SR1.72bn net profit in Q3

JEDDAH: Al-Rajhi Bank, Saudi Arabia's largest listed lender, said third-quarter net profit fell 8.1 percent. The bank made SR1.72 billion ($458.6 million) in the three months to September 30, compared with SR1.87 billion in the same period a year earlier, it said in a statement to the Saudi bourse.
Analysts polled by Reuters expected the bank, on average, to post a net profit of SR2.08 billion for the third quarter.
Al-Rajhi attributed the fall in net profit to a decrease in operating income, which dipped 4.6 percent compared to the corresponding period of 2012. It did not elaborate further.
The profit drop goes against the general trend in this reporting season, where most other Saudi banks are producing strong net profit growth on the back of a surging economy, fueled by high oil prices, which has boosted lending, deposits and deal activity.
Saudi companies issue brief earnings statements early in the reporting period before publishing more detailed results later.
Al-Rajhi's loans and advances at the end of the third quarter stood at SR185 billion, gaining 12 percent on the same point of 2012.
While at a nine-month low in August, bank sector lending to private companies still grew at a rate of 15 percent year-on-year, according to central bank data.
Increased retail lending has been a key driver of the Al-Rajhi's overall loan growth - it accounted for 70 percent of total loans in 2012 - and will continue to be so given its large network, Global Investment House said in a June 17 report.
Customer deposits stood at SR225 billion riyals on Sept. 30, up 12 percent on the same point last year.
Al-Rajhi's total assets were worth SR273 billion at the end of the third quarter, up 10 percent on the corresponding point in 2012.