H1 profits for SABB were up 14.61 per cent at
NBK Capital MENA comments…
Good set of results that carry no surprise; lower balance sheet liquidity supports NIM
Operating income up 11% YoY and came in line with our forecast (1.9% higher). Operating income reached
NIM increased QoQ on lower balance sheet liquidity. Balance sheet liquidity decreased in 2Q2014 as loans and investments increased (by around
Non-interest income advanced by 16% YoY and came slightly higher than our expectation. The breakdown of non-interest income is not disclosed in Saudi banks' preliminary earning releases.
Loan growth at 3% QoQ, broadly in line with our view for FY2014. Deposits were up a marginal 1% QoQ, which increased slightly the simple loans-to-deposits ratio to 81% by the end of
Good set of results with NIM trends, operating income, and loan growth coming in line with our view. However, net profit growth for 1H2014 (+14.5%) has been slightly stronger than our forecast for FY2014 (+10%). We maintain our fair value and our "Hold" recommendation on SABB; however, we will issue an update report on the bank after we speak with the bank's management.
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