Jul 12 2011 |
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Saudi's Al Rajhi Bk 2Q Pft Up 3.6% Vs Yr Ago On Investment Revs
Tuesday, Jul 12, 2011
(This story was originally published Monday.)
RIYADH (Zawya Dow Jones)--Saudi Arabia's Al Rajhi Bank (1120.SA), the Arab Gulf region's biggest lender by market value, Monday said second-quarter net profit rose 3.6% to 1.84 billion Saudi riyals ($491.5 million), from the year ago period, due to improved income from investments and banking services.
Analysts at Cairo-based EFG-Hermes had expected the bank to post a net profit of SAR1.85 billion in the three-month period, while analysts at Bahrain-based SICO had penciled in a SAR1.73 billion result.
Total operating profit for the second quarter stood at SAR3.1 billion, compared with SAR2.9 billion a year earlier, while profit from finance and investments inched up 0.7% to SAR2.3 billion.
In a separate statement the bank said its board of directors agreed to distribute SAR1.9 billion in dividends for the first half of the year, or SAR1.25 per share. The first half dividend represents 12.5% of the nominal value of shares.
Profits at most Saudi banks came under pressure in 2009 from increased provisions to counter exposure to some troubled Saudi firms and also from flat credit growth as lenders restricted loans during the global slowdown. But the performance of most banks started to recover last year after the lenders set aside enough provisions to cover the bulk of problem borrowings.
Most lenders had been expected to see higher earnings in the second quarter of 2011 due to lower provisions and higher income from lending activities, analysts said previously. Al Rajhi didn't say whether it booked provisions in the second quarter of year.
In addition, a two-month salary bonus announced by King Abdullah earlier this year as part of new expenditures packages worth about $129 billion has probably had a positive impact on loan growth for many banks in the second quarter, analysts said.
Al Rajhi shares closed trading Monday 0.3% higher at SAR75.50 in a slightly negative overall market.
-By Summer Said, Dow Jones Newswires; +966-546-842373; summer.said@dowjones.com
Copyright (c) 2011 Dow Jones & Co.
(END) Dow Jones Newswires
12-07-11 0428GMT
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