Earnings per share rose from
Total assets were up 4.81 per cent at
NBK Capital MENA comments...
Recovering loan growth; lower balance sheet liquidity supports NIM
Operating income in line with our forecast. Total operating income increased around 10% YoY, 6% QoQ, and came slightly higher (3.3%) than our forecast.
NIM in line with our view, increasing QoQ. Net interest income increased 8% YoY, 6% QoQ, and came in line with our forecast. One reason for the higher NIM was lower balance sheet as deposits dipped 7%, and we estimate that balances with SAMA decreased substantially compared with
Non-interest income rises 13% YoY, 7% QoQ, and came slightly higher than our forecast. The breakdown of non-interest income is not disclosed in Saudi banks' preliminary earning releases.
Loan growth at the highest level in two years. The bank's loan book expanded 5% in 2Q2014 following a contraction in 1Q2014, resulting in 3.7% YTD growth, in line with our view for FY2014. The drop in deposits allowed the loans-to-deposits ratio to return to a normalized level of 84% by the end of
Good set of results which came in line with our expectations. The bank's NIM, operating income, and loan growth came in line with our view for FY2014. For now, we maintain our fair value and our "Hold" recommendation on the stock (10% upside potential); however, we will issue an update report on ANB after we speak with the bank's management.
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