National Commercial Bank posted a 9.869% drop in net profit for the first half of the year compared to the same period in 2019.
The Saudi bank reported 4.922 billion riyals ($1.313 billion) in net profit for the six months ending June 30 versus 5.461 billion riyals for the corresponding period last year, according to its bourse filing on Sunday (July 26).
NCB said total operating expenses, including impairments, were higher by 18.5% mainly due to a few items, including higher net impairment charges for expected credit losses.
“Net impairment charge for expected credit losses reached to 1,224 million riyals for the current period against 470 million riyals in the similar period of the previous year with an increase of 160%,” said NCB.
Most of the net impairment charges were picked up in the second-quarter when they reached 828 million riyals, an increase of 155% compared to the same three months last year.
On its balance sheet, customer deposits were up by 16.174% to 380.398 billion riyals compared to 327.438 billion riyals for the first six months of 2019.
Growth for its financing and investment portfolio was 15.088% to 316.299 billion riyals.
NCB’s assets reached 557.310 billion riyals at the end of June, a 16.937% increase compared to the same time last year.
Last month, the bank announced it was discussing a potential merger with Samba Financial Group that would create a bank holding some 802 billion riyals ($214 billion) in assets. The two banks intend to conclude the deal in four months.
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