DUBAI Oct 13 Saudi British Bank
(SABB), the kingdom's sixth-largest bank by assets, posted a
12.7 percent drop in its third-quarter net profit on Thursday,
missing analysts' forecasts as it set aside more cash for bad
The bank, an affiliate of HSBC Holdings, said it
made 995 million riyals ($265.4 million) in the three months to
Sept. 30, compared with 1.14 billion riyals in the same period a
Four analysts surveyed by Reuters had expected the bank to
post an average net profit of 1.14 billion riyals.
The bank attributed the drop in profit to a 23.3 percent
jump in operating expenses, which it blamed on higher
impairments for credit losses as well as other costs.
Saudi banks face sluggish economic conditions as a result of
lower oil prices and reduced government spending, which has fed
through to lower net interest income and, in some cases, a rise
in provisioning for bad loans.
The tricky economic backdrop was reflected in a 2.9 percent
year-on-year decline in Saudi British Bank's total loans and
advances to 125.9 billion riyals on Sept. 30, while deposits
slumped 7.6 percent to 144.1 billion riyals.
Operating income for the quarter was flat on the
corresponding period of 2015 at 1.69 billion riyals, while
profits from special commissions increased 13.3 percent to 1.22
(Reporting by David French; Editing by Andrew Torchia)