10th Jul 2007 08:45
HSBC Holdings PLC10 July 2007 The following news release was issued today by The Saudi British Bank (SABB), a 40 per cent indirectly held associate of HSBC Holdings plc. THE SAUDI BRITISH BANK FIRST HALF 2007 RESULTS - HIGHLIGHTS • Net profit of SAR1,251 million (US$334 million) for the six months ended 30 June 2007 - down SAR558 million (US$148 million), or 30.8 per cent, compared with SAR1,809 million (US$482 million) for the same period in 2006. • Net profit of SAR635 million (US$170 million) for the three months ended 30 June 2007 - down SAR188 million (US$49 million), or 22.8 per cent, compared with SAR823 million (US$219 million) for the same period in 2006. • Operating income of SAR2,055 million (US$548 million) for the six months ended 30 June 2007 - down SAR573 million (US$153 million), or 21.8 per cent, compared with SAR2,628 million (US$701 million) for the same period in 2006. • Customer deposits of SAR65.2 billion (US$17.4 billion) at 30 June 2007 - up SAR10.1 billion (US$2.7 billion), or 18.3 per cent, compared with SAR55.1 billion (US$14.7 billion) at 30 June 2006. • Loans and advances to customers of SAR48.6 billion (US$13.0 billion) at 30 June 2007 - up SAR9.5 billion (US$2.6 billion), or 24.3 per cent, from SAR39.1 billion (US$10.4 billion) at 30 June 2006. • The bank's investment portfolio totalled SAR16.4 billion (US$4.4 billion) at 30 June 2007 compared with SAR15.3 billion (US$4.1 billion) at 30 June 2006. • Total assets of SAR85.1 billion (US$22.7 billion) at 30 June 2007 - up SAR12.3 billion (US$3.3 billion), or 16.9 per cent, over 30 June 2006. • Earnings per share of SAR3.34 (US$0.89) for the six months ended 30 June 2007 - down 30.8 per cent from SAR4.82 (US$1.29) for the same period in 2006. Commentary SABB recorded a net profit of SAR1,251 million (US$334 million) for the sixmonths ended 30 June 2007. This represents a 30.8 per cent decline compared withthe first half of 2006. However, net profit in the first half of 2007 increasedby 1.6 per cent compared with the second half of 2006. John Coverdale, managing director of SABB, said: "I am greatly encouraged by theprogress that SABB has made during the first half of 2007 especially with regardto core banking activities. The 24.3 per cent increase in loans and advancescompared to 30 June 2006, together with customer deposit growth, has generated asustainable SAR221 million, or 17.3 per cent, increase in net interest incomeand positions SABB well for the future. Brokerage and mutual funds businesscontinues to be subdued, significantly reducing SABB's first half 2007 profits,but core-banking non-funds income has grown by SAR28 million or 9.2 per centcompared to the first half of 2006. "Our cost base has reduced by SAR91 million, or 12.4 per cent, due to lastyear's one-off cost of re-branding the bank and lower 2007 profit-related bonusaccruals. Increased bad debts reflect growth in our card and consumer loan bookand our penetration of new market sectors. However, overall credit quality issound, supported by the strong underlying Saudi economy that is also helping todrive high levels of corporate activity, particularly in the construction andinfrastructure development sectors. "The market remains very liquid but SABB has effectively used the increase incustomer deposits over the last year to fund loan growth. The bank's capital andliquidity positions remain strong. "We are pleased to announce that our insurance company, SABB Takaful, hasobtained all necessary operating authorisations and began trading on 1 July2007. This, together with the 2006 formation of our joint venture investmentbank, HSBC Saudi Arabia Limited, is a major step towards our goal of becoming acomprehensive provider of financial services to our clients within the Kingdom. "We thank our customers for their continued support, and our staff for theircommitment and contribution to the bank's success." SABB's Board of Directors has recommended an interim dividend of SAR1.50 pershare for the first half of 2007, after the deduction of Zakat. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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