April 17, 2017 / 8:12 AM / 7 months ago

MIDEAST STOCKS-Saudi banks buoyed by results, Eshraq rises on fund tie-up

DUBAI, April 17 (Reuters) - Two Saudi Arabian banks outperformed in early trading on Monday after reporting their first-quarter earnings, while shares in Abu Dhabi real estate firm Eshraq were boosted by a plan to tie up with state fund Mubadala.

Shares in the second largest Saudi lender by assets, Al Rajhi Bank, rose 0.8 percent after it reported a net profit of 2.22 billion riyals ($589 million), up 10.1 percent from the prior-year period and in line with analysts’ average forecast of 2.16 billion riyals.

The Islamic bank had dropped 2.3 percent on Sunday on news that it was among Saudi companies being sued by U.S. insurers over the Sept. 11, 2001 attacks.

Mid-sized Bank Aljazira climbed 1.7 percent after its first-quarter earnings came in ahead of expectations. The bank made a net profit of 216 million riyals; NCB Capital had expected 184 million riyals and EFG Hermes 165 million riyals.

Profit plunged 43.3 percent from a year earlier, but the bank said this was because of a 209 million riyal special gain from a land sale in the year-ago period.

The Saudi index was up 0.1 percent.

In Abu Dhabi, Eshraq Properties, whose shares came under pressure last week on news that the emirate’s property prices were softening, climbed 2.7 percent after Abu Dhabi government fund Mubadala said it was considering forming a venture with the loss-making real estate developer.

This would involve developing land in Abu Dhabi owned by Mubadala on Al Maryah Island, where a new financial free zone is located, and by Eshraq on Al Reem Island.

Aldar Properties, which had also been trading lower in recent days, rebounded 0.5 percent, helping carry the Abu Dhabi index 0.6 percent higher.

In Dubai, loss-making builder Arabtec rose 2.5 percent after it hired a new chief financial officer, Peter Pollard, who will oversee its recapitalisation programme. At a shareholder meeting on Tuesday, Arabtec will seek investor approval for a 1.5 billion dirham ($408 million) rights issue. (Reporting by Celine Aswad; Editing by Andrew Torchia and Alexander Smith)

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