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Wed 28 Apr 2010 07:30 PM

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Saudi's Samba & SABB add loan loss provisions in Q1

Profits at Saudi banks declined during Q1 mainly due to a decline in lending income.

Samba Financial Group and SABB, two of Saudi Arabia's biggest lenders, booked additional provisions against loan losses during the first quarter after a surge in bad loans last year.

Profits at most Saudi banks declined during the first quarter due mainly to a decline in lending income.

It followed a difficult 2009 when Saudi lenders' profitability was eroded by provisions to counter exposure to a pair of troubled Saudi firms as well as flat credit growth in the wake of the global financial crisis.

Saudi stock exchange data showed Samba booked $42.69 million impairment charges for loan losses during the three months to March 31. That compares with $54.1 million a year earlier.

SABB, in which HSBC holds a 40 percent stake, set aside $47.05 million to cover loan losses during the first quarter of 2010 against $31 million in the year earlier period and a total of around $400 million for all of 2009, the data showed.

Smaller rival Saudi Investment Bank booked $83.4 million in the first quarter, up from $1.3 million a year earlier and against $115.8 million during the fourth quarter of 2009.

Banque Saudi Fransi, affiliated to French Calyon, raised loan loss provisions by an annual 17 percent in the first quarter to $14.3 million, which is far below the $111.4 million it booked during the last quarter of 2009 for the same purpose.

Saudi Hollandi Bank meanwhile booked $12.1 million in the first quarter, compared to $13.3 million in the prior year period. It booked $200.9 million during the fourth quarter of last year. (Reuters)

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