Saudi top bank NCB Q3 profit dives on global woes

by This email address is being protected from spam bots, you need Javascript enabled to view it on Sunday, 12 October 2008

RIYAL PAIN: NCB said it was a fall in the value of its investments rather than the US mortgage crisis that hurt profits. (Getty Images)

National Commercial Bank (NCB), Saudi Arabia's largest bank by assets, posted on Sunday a near 31 percent fall in third-quarter profit and blamed the global crisis for a poor performance this year.

State-owned NCB, which is slated for privatisation, made net profit of about 4.58 billion riyals ($1.22 billion) in the nine months to Sept. 30, down 4.9 percent from the year-earlier period, the bank said in a statement.

"The decline in net profit is due to a drop in the valuation at that period of the bank's investment portfolio, which has been affected by the fluctuations witnessed in global financial markets," NCB said.

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"The mortgage crisis does not have an impact on the bank's financial situation," it added.

It did not give a third-quarter breakdown, which newswire Reuters calculated based on the previous two quarters net profit of 3.7 billion riyals released by the bank.

NCB's third-quarter profit was about 878 million riyals compared with 1.26 billion riyals in the same period of 2007, according to a Reuters calculation.

Loans rose 28.9 percent to 111.85 billion riyals at the end of September and deposits grew 14.4 percent to 156.4 billion riyals.

NCB began consolidating in April earnings of Islamic lender Turkiye Finans, after the Saudi bank paid last year $1.08 billion for 60 percent of the Turkish bank's capital.

The Jeddah-based bank plans to sell shares to the public for the first time as part of a government plan to divest state assets. It has not yet set a date for an initial public offering. (Reuters)

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