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Saudi British Bank meets forecasts with 8.8 pct rise in quarterly profit

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Saudi British Bank meets forecasts with 8.8 pct rise in quarterly profit

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DUBAI (Reuters) – Saudi British Bank <1060.SE> (SABB), the kingdom’s sixth-largest bank by assets, reported an 8.8 percent rise in third-quarter net profit on Wednesday, meeting analysts’ forecasts. The bank, an affiliate of HSBC Holdings <HSBA.L>, said it made 1.08 billion riyals (£217.4 million) in the three months ending Sept. 30, compared with 995 million riyals in the same period a year earlier, according to a bourse filing. SABB is in merger talks with local peer Alawwal Bank <1040.SE>, with central bank governor Ahmed al-Kholifey telling Al Arabiya television on Oct. 15 that the situation regarding the possible merger would be clear by the end of this year. The bank attributed its rise in net profit to a 4.6 percent increase in operating income, propelled by higher net special commission income, gains on non-trading investments and dividend income, in addition to lower provisions for credit losses. After contending with lower state and consumer spending as a result of reduced oil prices, Saudi banks are expected to benefit as the government loosens austerity measures, helping accelerate credit growth. Saudi bank results so far have generally been in line with or better than expectations, with the two largest lenders, National Commercial Bank <1180.SE> and Al Rajhi Bank <1120.SE> reporting profit growth of 8.4 and 12.7 percent, respectively. Loans and advances at the end of September stood at 116.7 billion riyals, falling 7.3 percent on the same point of 2016, while deposits dropped 6.6 percent to 134.6 billion riyals over the same period. Three analysts surveyed by Reuters had on average forecast SABB’s third-quarter net profit would come in at 1.08 billion riyals.

(Reporting By Tom Arnold; Editing by Susan Fenton)
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