Islamic Finance

Saudi’s Shariah-compliant Alinma Bank posts lower 2019 earnings after restating 2018 profit


Saudi Arabia’s Alinma Bank posted an 11.27% drop in full-year 2019 net profit to 2.535 billion riyals ($676 million).

The Shariah-compliant bank said in a bourse filing on Sunday (Feb 2) that the drop comes after it restated its 2018 net profit as 2.857 billion riyals from 2.517 billion riyals.

The restated 2018 net profit number was made to reflect the impact of the settlement agreement between the bank and the General Authorioty for Zakat and Income, whereby all zakat claims were settled for the prior years up to 2017, said Alinma.

“In Q4 2018, the Bank entered into a settlement of zakat claims agreement with GAZT for periods up to and including 2017. The amount of the settlement was a net refund to Alinma of 263 million riyals,” said Alinma Bank.

The bank said its net income before zakat gives a more realistic comparison of its performance year-on-year.

Net income before zakat increased by 12% compared to 2018 as a result of a 16% growth in total operating income. The bank attributes this to factors including higher income from financing, investment and banking fees.

Total operating expenses went up by 20% as a result of higher provision, salaries, and general and administrative expenses.

($1 = 3.75 Saudi riyals)

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