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Saudi bank Samba's quarterly profit falls 2.5 pct
November 1, 2017 / 2:02 PM / 18 days ago

Saudi bank Samba's quarterly profit falls 2.5 pct

DUBAI, Nov 1 (Reuters) - Saudi Arabia’s third-largest bank by assets, Samba Financial Group, reported a 2.5 percent drop in third-quarter net profit on Wednesday, blaming rising credit costs and other expenses.

Net profit of 1.31 billion riyals ($349 million) in the three months to Sept. 30 was down from 1.34 billion riyals in the same period a year earlier, the bank said in a bourse statement.

Three analysts polled by Reuters had on average forecast the bank would make a quarterly net profit of 1.27 billion riyals.

Earlier on Wednesday, Saudi lender Alawwal Bank reported a 38.1 percent rise in third-quarter net profit to 363 million riyals as impairments eased, while Banque Saudi Fransi said its profit fell 0.9 percent to 1.00 billion riyals as operating expenses rose.

Samba attributed its drop in profit to a 2.7 percent rise in total operating expenses as credit costs and other expenses rose. Total operating income slipped by 0.7 percent as fees declined for banking services, exchange income and net special commission income.

Saudi banks have for more than three years felt the fallout from weaker oil prices as the government embarked on an austerity drive in a bid to fill a budget shortfall. But analysts expect banks’ performance in the coming quarters to improve gradually, aided by a pickup in liquidity and lower funding costs thanks to a loosening in public spending and international sovereign debt issuance.

Samba’s loans and advances at the end September stood at 120.7 billion riyals, sliding 7 percent on the same point of 2016, while deposits dropped 4.2 percent to 166.7 billion riyals over the same period. ($1 = 3.7501 riyals) (Reporting By Tom Arnold; Editing by Susan Fenton)

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