Bank Albilad’s Q1 profit beats estimates, says Aljazira Cap

Bank Albilad reported a net profit of SAR 229.4 million for the first quarter of 2017, beating Aljazira Capital’s estimates of SAR 221.1 million by 3.7 percent, the brokerage said in an earnings review.

The Q1 earnings were 31.5 percent higher year-on-year (YoY) and 3.6 percent higher compared to the previous quarter.

“Solid deposit and loans growth supported the top line, despite lower than expected effective lending rate,” the review said.

The net profit increase is attributed to a 21.8 percent YoY increase in gross financing and investment income and 10.8 percent YoY growth in other operating income.

“Deposits for Albilad stood at SAR 43.5 billion, depicting a jump of 8.2 percent quarter-on-quarter (QoQ) and -0.9 percent YoY,” the report said

The total operating income reached SAR 694.5 million, up 10.8 percent YoY and 1.67 percent QoQ. Operating expenses were SAR 465 million, edging 1 percent QoQ and 2.8 percent YoY.

“Albilad’s strong topline performance and higher operating income resulted from solid loans and deposit growth along with higher interest rates. For 2017, Albilad is expected to post earnings of SAR 855 million, depicting a jump of 5.7 percent YoY,” the firm said.

Aljazira Capital affirmed its “neutral” rating on Bank Albilad’s stock with a target price of SAR 19.90.