DUBAI: Saudi Hollandi Bank, Saudi Arabia’s oldest lender, missed analyst expectations despite posting a 10.8 percent rise in fourth-quarter net profit.
The lender, partly-owned by Royal Bank of Scotland, said in a bourse filing yesterday it made SR347.3m ($92.6m) in the three months to December 31, compared with SR313.4m in the corresponding quarter of 2012.
Six analysts surveyed by Reuters had forecast it would post, on average, a net profit of SR375m. The bank’s net profit for the quarter was boosted by a 22 percent jump in total operating income to SR671.1m, while profit from special commissions grew 23.8 percent year-on-year to SR427.1m.
Its full-year net profit was SR1.5bn, a 19.8 percent increase on 2012, which it attributed to higher operating income. That rose 17.9 percent in 2013 to SR2.62bn.
Saudi firms issue brief earnings statements early in the reporting period before publishing more detailed results later.
Saudi Arabian banks are benefiting from a positive economic climate, as years of high oil prices and government surpluses have pushed state spending to record levels, with high loan growth a big driver of profit growth.
Saudi Hollandi’s loans portfolio stood at SR53.7bn on December 31, 18.5 percent higher than the same point of 2012.
Many lenders have been raising capital in recent months to strengthen their reserves, with Saudi Hollandi completing a SR2.5bn capital-boosting Islamic bond issue in December.
The sukuk led NCB Capital to upgrade the stock to overweight on December 25 as a sign of strong future loan growth offsetting the risk to net interest margins from higher cost of funding.
Its deposit base gained 14.8 percent year-on-year to SR61.9bn at the end of 2013. Saudi Hollandi’s board recommended a 2013 cash dividend of one riyal per share last month, in line with the previous year.
Reuters
