In this report, Argaam highlights the expected financial results of Bank Albilad for Q3 2021, which will be announced over the coming days, as well as its key events, earnings, and performance indicators.
The bank’s net profit for Q2 2021 rose compared to the same period last year on higher operating income and lower provisions.
The table below illustrates the bank's quarterly earnings since Q2 2020.
| Item | Q2 2020 |
Q3 2020 |
Q4 2020 |
Q1 2021 |
Q2 2021 |
|---|---|---|---|---|---|
| Profit before provisions and non recurring items | 463.99 | 542.89 | 558.05 | 562.25 | 552.43 |
| Quarter share before provisions and non-recurring items (Riyal/Share) | 0.37 | 0.43 | 0.45 | 0.45 | 0.44 |
| Provision for loans and investment | (145.92) | (160.29) | (180.25) | (169.50) | (136.35) |
| Net Income | 318.06 | 382.61 | 377.81 | 392.75 | 416.09 |
| Extraordinary income/expense | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Net Profit Before Unusual Items | 318.06 | 382.61 | 377.81 | 392.75 | 416.09 |
| EPS Before Unusual Items (Riyal/Share) | 0.25 | 0.31 | 0.30 | 0.31 | 0.33 |
Key Events in Q3 2021
The bank announced its intention to redeem the outstanding SAR-denominated regulatory Tier 2 capital sukuk, due 2026, in full at face value on Aug. 30.
The value of the outstanding sukuk currently stands at SAR 1.06 billion. The sukuk was issued by way of a private placement on Aug. 30, 2016, with an aggregate face value of SAR 2 billion and original maturity of 10 years, due on Aug. 30, 2026.
Key highlights of the banking sector
The banking sector's aggregate net profit before Zakat and tax rose by 48% to SAR 34.3 billion during the first eight months of 2021, compared with SAR 23.2 billion a year earlier, according to the recent data of Saudi Central Bank (SAMA).
The sector's aggregate earnings before Zakat and tax climbed by 7% in July and August 2021, to SAR 9.17 billion, from SAR 8.57 billion a year earlier.
Similarly, the sector's assets rose by 9.3% YoY, while loans and deposits grew by 15.1% and 8.9%, respectively.
| September - 2020 | September - 2021 | Change (%) | |
|---|---|---|---|
| Total Assets | 2,879.70 | 3,151.24 | 9.43 % |
| Total Deposits | 1,881.08 | 2,057.98 | 9.40 % |
| Total Credit | 1,723.79 | 1,985.71 | 15.19 % |
| Total Profit | 27.61 | 40.18 | 45.51 % |
Saudi Arabian Interbank Offered Rate (SAIBOR) dropped to 0.808% in Q3 2021 from 0.793% in Q2 2021 and 0.869% in Q3 2020.
Balance Sheet
The bank’s assets grew 21.1% during Q2 2021. Net financing investments and deposits also increased by 21.9% and 25.8%, respectively.
| Period | Q2 - 2020 | Q2 - 2021 | Change |
|---|---|---|---|
| Total Assets | 88,857.72 | 107,652.14 | 21.15% |
| Net Financing Investments | 64,922.66 | 79,129.99 | 21.88% |
| Customer Deposits | 64,875.73 | 81,638.06 | 25.84% |
| Demand Deposits | 58,624.72 | 65,224.93 | 11.26% |
| Time Deposits | 4,487.34 | 13,609.01 | 203.28% |
| Period | Q2 - 2020 | Q2 - 2021 | Change |
|---|---|---|---|
| Non-performing Financing Investments | 881.15 | 1,012.50 | ↑ |
| Non-performing loans & advances | 1.36 % | 1.28 % | ↓ |
| Financing Investments Loss Provision | (2,117.46) | (2,621.28) | ↓ |
| Provisions Coverage Ratio | 240.31 % | 258.89 % | ↑ |
Average forecasts
Bank Albilad is expected to report a net profit of SAR 421.5 million for Q3 2021, a 10% YoY increase, according to average estimates of six research firms.
| Analyst | Million Riyals |
|---|---|
| Riyad Capital | 470.00 |
| SNB Capital Company | 423.00 |
| EFG-Hermes KSA | 423.00 |
| Osool and Bakheet Investment Co. | 414.10 |
| AlJazira Capital Company | 409.00 |
| CI Capital Company | 390.00 |
| Average | 421.52 |
| Net Profit Before Unusual Items (2020 - Q3) | 382.61 |
| Change % | 10.17% |
| Item | The Company | TASI |
|---|---|---|
| YTD | (1.13 %) | 36.92 % |
| Change(12M) | 18.88 % | 37.96 % |
| Previous Close | 25.76 | 11,792.54 |
| P/E adjusted (x) | 19.68 | 24.56 |
| EPS (TTM) before unusual items (SAR/Share) | 1.26 | - |
| P/E (TTM) | 17.13 |
| P/E Before Unusual Items (TTM) | 17.13 |
| P/BV | 2.79 |
| Dividend Yield | 1.10 % |
| Market Cap. (M) | 44,937.50 |
| Return on Average Assets | 1.80 % |
| Return on Average Equity | 17.07 % |
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