Saudi National Bank reports 32% surge in first-quarter net profit

The bank's total assets climbed 54% to reach $246bn

Tadawul-listed Saudi National Bank's total operating income in the first quarter surged 41 per cent to 8bn riyals. Faisal Al Nasser / Reuters

Saudi National Bank, the kingdom's largest lender by assets, reported a 32 per cent jump in its first-quarter profit on the back of higher operating income as the kingdom’s economy continues to rebound from the Covid-19 pandemic.

Net profit for the three months to the end of March rose to 4.5 billion Saudi riyals ($1.2bn), the lender said in a statement on Wednesday to the Tadawul Stock Exchange, where its shares are traded.

Total operating income for the period surged 41 per cent to 8bn riyals “due to higher net special commission income, fees from banking services, foreign exchange income and lower other operating expenses”, SNB said.

Income from special commissions and investments rose 41 per cent to 7bn riyals. The bank's total assets climbed 54 per cent, to reach $246bn.

Total operating expenses, including net impairment charge for expected credit losses, climbed 52 per cent during the quarter, amid higher salaries and employee-related expenses, rent and premises-related expenses and other general and administrative expenses, the lender said.

Banks in Saudi Arabia as well as across the region are reporting higher profits as economies recover from the pandemic. Al Rajhi Bank, Saudi Arabia’s second-largest lender by assets, reported a 24 per cent jump in its first-quarter net profit, while the National Bank of Kuwait posted a 38 per cent jump in profit for the same period on lower impairment losses.

Emirates NBD, Dubai's largest lender by assets, meanwhile, reported an 18 per cent surge in its quarterly profit amid the UAE's continued recovery from the pandemic-induced slowdown.

GCC economies are expected to grow 4.5 per cent this year, buoyed by the increase in oil prices, the World Bank said in a report earlier this month.

Brent, the global benchmark for two thirds of the world's oil, is up more than 30 per cent since the start of this year, after falling from a 14-year high when it nearly touched $140 per barrel last month, amid the Russia-Ukraine conflict.

Saudi Arabia, the Arab world’s largest economy and Opec’s biggest oil producer, is forecast to grow 7.7 per cent this year, from 3.2 per cent last year, helped by higher oil prices and a robust non-oil sector, said Jadwa Investment.

SNB was created following the merger of National Commercial Bank with smaller rival Samba Financial Group last year. Total assets of the bank surged 54 per cent to 922bn riyals ($246bn), while customer deposits during the period rose 44 per cent to 605bn riyals, it said.