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Thu 19 Jan 2017 11:01 AM

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Saudi Arabia's Al Rajhi Bank reports 5% profit hike

Kingdom's second-largest lender by assets has reported five consecutive quarters of profit

Saudi Arabia's Al Rajhi Bank reports 5% profit hike

Al Rajhi Bank, Saudi Arabia's second-largest lender by assets, reported a 5 percent rise in fourth-quarter net profit on Wednesday, meeting analysts' forecasts as financing, investment and other income all increased.

The bank extended its run of rising profits to five quarters in a row, despite the impact of austerity measures by the government aimed at trimming the kingdom's budget deficit to adjust to lower oil revenues.

It reported its results on the same day that National Commercial Bank (NCB), the kingdom's largest lender, reported a 7.5 percent rise in fourth-quarter net profit, boosted by higher income from commission and investments.

Al Rajhi made 2.05 billion riyals ($547 million) in the three months to Dec. 31, up from 1.95 billion riyals in the same period a year earlier, it said in a statement.

That was in line with the average forecast of five analysts surveyed by Reuters.

Saudi companies issue brief earnings statements early in the reporting period, later publishing more detailed results.

Al Rajhi attributed its performance to a 6.1 percent climb in total operating income as a result of higher net financing and investment income and a rise in other operating income.

Fee income from banking services and net exchange dropped, while total operating expenses climbed 7.3 percent because of higher staffing, rental and depreciation costs.

Loans and advances at the end of December stood at 224.99 billion riyals, gaining 7.0 percent on the same point of 2015, while deposits grew by 5.7 percent to 272.59 billion riyals over the same period.

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