The Saudi Investment Bank announced that it has achieved a net profit exceeding SR 490.5 Million during the First Half of 2005, compared with SR 293.9 Million for the same period the last year. This represents an increase of 66.9%. The earning per share reached SR 14.27 compared with SR 8.55 over the same period last year.
The Income Statement has witnessed significant growth in most of the income categories. Fees from banking services have increased by 83% over the same period last year to reach SR. 274.4 Million. Profit from foreign exchange trading rose to SR 10.5 Million while profit realized from the sale of investments decreased to SR 23.6 Million compared with SR 60.9 Million for the same period last year. The Bank’s total operating income rose to SR. 689.8 Million, in spite of the increase in general expenses that came as a result of the expansion in the Bank’s business and its services, increase in the number of staff and the decrease in the profits realized from sale of investments.
On the expenses side, the Bank continued to follow its conservative policy towards setting aside provisions in order to enable it to expand its lending activities. With a further provision of SR 50 Million, the balance of the credit losses provision stood at SR 642 Million; whereas the non-performing loans balance has not exceed SR 190 Million. The Bank also continued to increase its efficiency ratio which reached 21.7%, considered the best among the Saudi Banks, compared with 27.8% for the same period last year. The above positive results were reflected in the return on the shareholders’ average equity, which rose to 24.69%, and the return on average assets, which rose to 3.16%, in comparison with 21.04% and 2.69% respectively during the past year.
The Balance Sheet highlights the growth in net loans portfolio, which increased to SR. 17,194 Million, compared with SR. 10,835 Million for the same period a year earlier i.e. an increase of 58.7%. At the same time, the Bank’s total investment portfolio grew by 40.9% to reach SR 9,890 Million compared with SR 7,017 Million for the same period last year.
On the liabilities side, customers' deposits in the Bank reached SR 24,465 Million compared with SR 22,201 Million i.e. an increase of 69.4%. As a result, the Bank’s total assets as of 30/06/2005 rose to SR 34,053 Million compared with SR 22,201 Million. In other words, the Bank has succeeded to increase its size by 53.4% in a single year.
The shareholders' equity rose to SR 4,500 Million with an increase of SR 1,515 Million over the same period last year, representing an increase of 50.7%.
Dr. Abdul Aziz Al-Abdullah Al Ohali, and on behalf of the other members of the board, expressed his pleasure with the Bank’s positive results and its continuing substantial business growth.
Mr. Saud Al Saleh, the General Manager of the Bank, said that the Bank has been able to achieve these results by taking advantage of the emerging opportunities and due to the concerted efforts of its employees that are geared towards rendering the best services possible to the customers. The Bank’s diversification and expansion of its services have allowed it to respond to the needs of its corporate and retail clients. The General Manager also noted that the award received by SAIB as the best in Corporate Banking in the Kingdom, as this award has highlighted the Bank’s focus to maintain its leadership in providing services to the corporate sector in the fields of industry, trade, contracting and services, in spite of the diversified services provided to its retail customer base. In the investment services field, the Bank launched 4 new investment funds during the second quarter of 2005, out of which three funds are Shariah compliant and have been approved by the Bank’s Shariah Committee. Accordingly, the Bank offers ten funds to its customers as investment options. The Investment Portfolios Management Group has been created within the organizational structure of the Bank. As a result, a complete team specialized in investment portfolios management has become part of the SAIB organization. This step highlights the importance of supporting the capabilities and the potential of the Bank towards achieving its goal of providing the best investment products, especially in the field of investment portfolio management. Before joining SAIB, the team had been managing a number of investment portfolios in the stock markets and had managed to carve out a big share of the private investment portfolio management market.
