Banque Saudi Fransi's Q2 profit falls on provisions

BELOW EXPECTATIONS: Q2 profits drop reported by Riyadh-based Banque Saudi Fransi was below analysts' expectations. (Getty Images)

Banque Saudi Fransi, the Saudi affiliate of France's Calyon, posted a 10.6 percent drop in second-quarter profit, below analysts' expectations, as it booked provisions.

Saudi Arabia's fourth-largest bank by market value made a net profit of 692 million riyals ($184.5 million) in the three months ending June 30, 2009 against 774.1 million riyals in the year-earlier period, it said in a statement.

Two analysts surveyed by Reuters had expected net income of 728.5 million riyals on average.

"The reason for the net profit decline is due to the conservative policy of the bank and a rise in the lending portfolio," the bank said in a statement on the bourse website, adding that operational income had improved compared with the first quarter.

Like other major Saudi lenders the bank did not say whether it was exposed to troubled Saudi family firms Saad Group and Ahmad Hamad Algosaibi and Bros Group (AHAB).

The bank said it had taken provisions and "taken into consideration the prevailing market conditions".

Net commission income rose 23 percent to 757 million riyals in the quarter, while the loan portfolio gained by 7.1 percent in the first six months to 81 billion riyals.

Operating profit increased 2 percent in the second quarter to 1.1 billion riyals. Deposits rose 6 percent to 90 billion riyals, while assets rose 7 percent to 123 billion riyals.

The value of investments declined 3.9 percent to 19.6 billion riyals in the first six months. It gave no quarterly data.

The bank's shares rose 1.5 percent on Tuesday, while the main index ended up 2.4 percent. Results were released after markets closed.

Calyon is the investment banking arm of French retail bank Credit Agricole. (Reuters)

Print | Email | Discuss this article

| Share |

READERS' COMMENTS

Click here to post a comment

Add your Comment All posts are sent to the administrator for review and are published only after approval. ArabianBusiness.com reserves the right to remove any comment at any time for any reason. Please keep your responses appropriate and on topic. Arabian Business would like to point out that only comments relevant to the story will be published. Any containing personal insults or inappropriate language will not be approved.
Name *
Remember me on this computer
Email *	(Your email address will not be published)
City
Country
Subject *
Comment *
Notify me of further comments
Enter the words above *
Please click post only once - your comment will not be published immediately.

MORE FROM ARABIANBUSINESS.COM