HSBC affiliate hit by provisions for bad debts in fourth quarter
Saudi Arabia’s Sabb has reported a 96 per cent fall in profits in the fourth quarter of 2009, as a result of a slowdown in lending and rising provisions against loan losses.
The bank, which is 40 per cent owned by the UK’s HSBC, reported a fourth quarter profit of just SR26m ($6.93m). For the full year it reported a profit of SR2bn, a fall of 30 per cent from 2008 levels.
Managing director Richard Groves describes the 2009 profit levels as “encouraging”, and blamed the fall compared to 2008 on “Sabb’s continued conservative policy to enhance its financial position.”
Sabb had customer deposits of SR89.2bn at the end of 2009, down 3.8 per cent compared to the end of 2008. The value of loans and other advances was down 4.7 per cent to SR76.4bn.
Total assets fell by 3.7 per cent to SR126.8bn, and its investment portfolio fell to SR23.8bn from SR29.6bn at the end of 2008.