SABB’s market share slightly above 8%, NPLs continue to decline: CEO

Tony Cripps CEO of SABB

Saudi British Bank’s (SABB) market share was slightly above 8% in 2022, CEO Tony Cripps said, expecting healthy growth in the market share.

The strong rise in Q4 2022 net profit was spurred by some non-recurring items, but the annual earnings were driven by interest rates, growth in the loan and deposit portfolios, quality of assets, and low cost of risk, Cripps told Al-Arabiya TV.

The ratio of non-performing loans (NPLs) continued to decline, reaching 2.3% in 2022, with a 140% coverage ratio.

SABB’s loan portfolio is split into 75% variable-interest corporate loans and 25% fixed-interest retail loans. The corporate loans have a three to six-month term. With rising interest rates, these loans are repriced, however margins are always discussed, Cripps added. The retail book depends on fixed interest rates. Accordingly, interest on mortgage loans do not change as they have a term of 25 years. The loan portfolio changes based on interest rates.

Replying to a question about the liquidity injected by Saudi Central Bank (SAMA), Cripps said SABB was in no need for any liquidity. “I believe, SAIBOR witnessed some pressures in the sector. However, SAMA calmed markets. Since that time, SAIBOR was stable in the last six to 12 months,” he added.

Therefore, liquidity pressures are unlikely in the banking sector, the CEO said, noting that SABB’s liquidity ranks among the highest in the sector.

The Kingdom’s economy is solid and inflation is under control. Overall, the macroeconomic conditions are very positive, as evidenced by the number of foreign visitors to the bank and the bank’s partner, HSBC.

SABB reported a net profit of SAR 4.87 billion in 2022, compared to SAR 3.20 billion a year earlier, Argaam reported.