National Bank of Oman Q2 profit drops 47%

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National Bank Of Oman reported a 47 percent drop in second quarter profit on Thursday, below analysts' forecasts, and cited a "difficult operating environment" as the bank increased provisioning for bad loans.

Net profit after tax for the quarter fell to 6.117 million rials ($15.89 million), the bank said in a statement on the bourse website. This compared to 11.63 million rials in the same quarter in 2008, according to Reuters data.

For the six-month period ending June 30, the bank said it had increased its provision coverage ratio -- a measure of how much money the bank has set aside to protect against potential loan losses - to 102 percent from 95 percent one year earlier.

Net interest income for the six-month period rose by 25 percent to 27.8 million rials, the bank said.

The average second-quarter profit forecast of three analysts polled by Reuters was 9.94 million rials.

Bank Muscat, the country's largest lender by market value, said on Wednesday second-quarter profit fell 62 percent, partly because of provisions against potential losses at two Saudi conglomerates. (Reuters)

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