Riyad Bank posts 12 percent profit increase in 2001
Riyad Bank (RB) posted a net profit of 1.4 million Saudi Riyals ($374,000) in 2001, an increase of 12 percent compared to the previous year, improving the return on assets to two percent, up from the 1.86 percent recorded in 2000.
The Bank maintained its growth momentum and achieved an increase in profits despite a significant drop in market rates and a consequent decrease in yields, stated a bank press release. It also reduced total operating expenses by 3.3 percent to SR48 million.
The bank’s total operating income increased from SR121 million in 2000 to SR193 million the following year, due mainly to an increase in gains on investments. The bank’s total assets grew by SR2.1 billion, reaching SR67.2 billion in 2001. Loans and advances grew by SR892 million to reach SR21.2 billion.
Automation and customer services enabled the bank to post a rise of SR1.7 billion in customer deposits, which currently stand at SR40.1 billion. Fee income on banking services reached SR257 million in 2001, compared to SR240 million in 2000, an increase of seven percent.
RB Chairman Rashed Abdulaziz Al-Rashed announced that the Board of Directors has recommended to the General Assembly to distribute SR1,200 million as cash dividends to the bank’s shareholders, that is SR15 per share, an increase of 50 percent over last year’s dividend.
RB was established in 1957, with an initial capital of SR50 million, as a full service commercial bank. The Saudi private sector owns 71 percent of the bank and the balance is held by Saudi government agencies. Its main activity is providing commercial banking services through its network of 193 branches in Saudi Arabia, in addition to its overseas branches and subsidiaries in London, Houston and Singapore.
Riyad bank is one of the largest banks in the sector. Its long-term performance is one of consistency, though the growth rate has fallen in the last three years. However, the net profit grows at a healthy 15.95 percent rate per annum, according to the Consulting Center for Finance and Investment. Over the 10-year period ending in 2000, RB has grown the size of its balance sheet from SR 48 billion to SR 65.5 billion, representing a 36 percent increase. — (Mena report)
© 2002 Mena Report (www.menareport.com)