Saudi's Arab National Bank CEO quits post after 15 years

Company has recently incurred 45% plunge in net profits

A trader uses his mobile as he monitors screens displaying stock information at the Saudi Stock Exchange (Tadawul) in Riyadh June 15, 2015.

A trader uses his mobile as he monitors screens displaying stock information at the Saudi Stock Exchange (Tadawul) in Riyadh June 15, 2015.

REUTERS/Faisal Al Nasser

The CEO of Saudi Arabia’s Arab National Bank has quit his post after more than 15 years with the company.

Dr. Robert Eid, who has been the managing director and CEO of the bank since 2005, submitted his resignation on September 22, 2020 due to personal reasons, the bank told the Saudi Stock Exchange (Tadawul).

The announcement comes shortly after the lender’s net profits for the second quarter of the year nearly halved, and at a time when banks across the Gulf are facing headwinds related to the coronavirus pandemic and low oil prices.

The bank said on Tuesday that its board of directors has resolved to accept Eid’s resignation with effect from January 2, 2021.

“The board of directors extends its gratitude and appreciation to Dr. Robert Eid for his sincere and continuous efforts to enhance the bank’s performance and preserve its achievements throughout a period spanning over 15 years,” the bank said.

Net profits

The bank’s net profit plunged 45 percent to 486 million Saudi riyals in the second quarter of the year compared to the same period last year, while its total operating expenses went up by 21.5 percent, resulting mainly from the increase in impairment charge for credit losses, among others.

The year-on-year decline in net profit has been attributed to the 15.2 percent decrease in total operating income.

Analysts at ratings agency S&P had earlier said that the asset quality of banks in the Gulf Cooperation Council (GCC) region could deteriorate as a result of the pandemic. The 23 banks tracked by the ratings agency had assets totalling $1.5 trillion as of the end of 2019, which could absorb up to $36 billion in extra provision before capital bases start to erode.

“For the GCC in general we now expect a deterioration in asset-quality indicators in all countries, potentially with [non-performing loans] doubling in 2020,” Mohamed Damak, senior director and global head of Islamic finance at Ratings, had said during a webinar in April.

(Reporting by Cleofe Maceda; editing by Seban Scaria)

Disclaimer: This article is provided for informational purposes only. The content does not provide tax, legal or investment advice or opinion regarding the suitability, value or profitability of any particular security, portfolio or investment strategy. Read our full disclaimer policy here.

© ZAWYA 2020

More From Equities