Al Rajhi Bank, the largest Gulf bank by market value, yesterday posted second quarter profit near the top end of analysts' forecasts on higher income from its core activities.
The Saudi lender made a net profit of 1.74 billion riyals (Dh1.70bn) in the three months ending June 30, 2007, up 8.2 per cent from the SAR1.61bn it made in the year-earlier period, it said. Analysts' forecasts for Rajhi's second quarter profit ranged from SAR1.61bn to SAR1.75bn in a Reuters survey last month.
It was the strongest rise quarterly net profit since December 2006, after which the bank had a run of negative results on the back of a 2006 regional stock market crash which slashed banks' brokerage and fund management revenue.
Rajhi's net investment income – the equivalent of net income from lending in traditional banking – rose 12 per cent in the second quarter to SAR2.14bn.
Banking services income rose 44 per cent to SAR577 million, it said, without giving details about other sources of revenue such as from trading and foreign exchange operations. Earnings per share reached SAR2.23 up from SAR2.12 a year earlier, it added.
The bank raised its paid-up capital by 11.1 per cent earlier this year through a bonus share issue.