Oct. 12 (Bloomberg) -- Al Rajhi Bank, Saudi Arabia’s largest lender by market value, led others in posting higher third-quarter profit as lending income rose amid higher government spending in the biggest Arab economy.
Al Rajhi’s net income in the period climbed 18 percent to 1.94 billion riyals ($516 million), it said in a statement to the Saudi bourse today. The mean estimate of six analysts was for a profit of 1.9 billion riyals, according to data compiled by Bloomberg.
Higher lending has helped improve earnings at Saudi banks as growth in the world’s largest oil producer accelerates, spurred by a $130 billion spending plan announced by King Abdullah. Saudi British Bank, the kingdom’s fourth-largest lender by market value, Banque Saudi Fransi and Saudi Hollandi Bank reported higher quarterly profit.
Saudi British reported a 50 percent jump in profit to 630 million riyals and Banque Saudi, a Saudi lender part-owned by Credit Agricole SA, said profit climbed to 760 million riyals in the period.
Saudi Hollandi posted a third-quarter profit of 299.4 million riyals, compared with 85.3 million riyals a year earlier, and beating the 239.6 million-riyal mean estimates of five analysts compiled by Bloomberg.
Al Rajhi’s profit rose as the lender gained “higher income from banking fees and investment income,” the company said. Operating profit rose 7.6 percent to 3.65 billion riyals in the third quarter, while total lending climbed 12.3 percent to 134.6 billion riyals at the end of September.
Al Rajhi shares advanced 0.4 percent to 68.50 riyals while Saudi British dropped 0.5 percent to 40 riyals. Banque Saudi declined 1 percent to 38.60 riyals and Saudi Hollandi fell 0.8 percent to 25.90 riyals. The Tadawul All Share Bank Index has tumbled 15 percent this year.
--Editors: Peter Branton, Tim Farrand
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