In this report, Argaam highlights the expected financial results of Saudi British Bank (SABB) for Q1 2023, which will be announced in the next few days, as well as its key events, earnings, and performance indicators.
The bank reported growth in Q4 2022 net profit, backed by higher operating income and lower provisions.
| Item | Q4 2021 |
Q1 2022 |
Q2 2022 |
Q3 2022 |
Q4 2022 |
|---|---|---|---|---|---|
| Profit before provisions and non recurring items | 840.42 | 1066.01 | 1218.57 | 1433.45 | 1452.81 |
| Quarter share before provisions and non-recurring items (Riyal/Share) | 0.41 | 0.52 | 0.59 | 0.70 | 0.71 |
| Provision for loans and investment | (413.50) | (59.78) | (135.90) | (37.51) | (212.07) |
| Net Income | 426.92 | 1,006.22 | 1,082.67 | 1,504.54 | 1,234.18 |
| Extraordinary Items | 0.00 | 0.00 | 0.00 | 108.60 | (6.56) |
| Net Profit before Extraordinary Items | 426.92 | 1,006.22 | 1,082.67 | 1,395.94 | 1,240.74 |
| EPS Before Unusual Items (Riyal/Share) | 0.21 | 0.49 | 0.53 | 0.73 | 0.60 |
Key events in Q1 2023
SABB board proposed a 7.4% cash dividend, or SAR 0.74 per share, for the second half of 2022.
Banking Sector Data
The banks operating in Saudi Arabia reported a 17% jump in aggregate net profit before Zakat and tax to nearly SAR 19.02 billion from January-March 2023, compared to SAR 16.26 billion a year earlier, recent data from the Saudi Central Bank (SAMA) showed.
Aggregate assets grew by 11.2% year-on-year (YoY). Loans and deposits also increased by 10.3% and 10.8% YoY, respectively, in the same period.
| March - 2022 | March - 2023 | Change (%) | |
|---|---|---|---|
| Total Assets | 3,370.36 | 3,746.89 | 11.17 % |
| Total Deposits | 2,166.62 | 2,400.77 | 10.81 % |
| Total Credit | 2,134.10 | 2,354.61 | 10.33 % |
| Total Profit | 16.26 | 19.02 | 16.99 % |
Saudi Arabian Interbank Offered Rate (SAIBOR) rose to 5.69% at the end of Q1 2023, from 5.34% in Q4 2022 and 2.45% in Q1 2022.
Balance Sheet
The bank's assets grew by 15.4% YoY in Q4 2022. Deposits and net loans rose 14.7% and 9.3% YoY, respectively, in the same period.
| Period | Q4 - 2021 | Q4 - 2022 | Change |
|---|---|---|---|
| Total Assets | 272,396.02 | 314,404.12 | 15.42% |
| Net Loans & Advances | 167,556.48 | 183,132.25 | 9.30% |
| Customers' Deposits | 186,760.61 | 214,278.85 | 14.73% |
| Demand Deposits | 152,966.15 | 141,427.47 | (7.54%) |
| Time Deposits | 30,443.04 | 69,651.65 | 128.79% |
| Period | Q4 - 2021 | Q4 - 2022 | Change |
|---|---|---|---|
| Non-Performing Loans & Advances (NPLs) | 8,686.26 | 8,736.40 | ↑ |
| NPLs/Total Loans & Advances | 4.98 % | 4.62 % | ↓ |
| Provision for Credit Losses (PCL) | (6,702.24) | (6,010.48) | ↑ |
| Provisions Coverage Ratio | 77.16 % | 68.80 % | ↓ |
Average Forecasts
SABB is forecast to post a profit leap of 50% YoY to SAR 1.51 billion in the first quarter of 2023, according to average estimates of four research houses.
| Analyst | Million Riyals |
|---|---|
| JP Morgan | 1,714.00 |
| Osool and Bakheet Investment Co. | 1,587.00 |
| Arqaam Capital Limited Co. | 1,586.00 |
| Riyad Capital | 1,534.00 |
| EFG-Hermes KSA | 1,491.00 |
| Securities & Investment Company | 1,485.00 |
| U-Capital Co. | 1,434.30 |
| Average | 1,547.33 |
| Net Profit before Extraordinary Items (2022 - Q1) | 1,006.22 |
| Change % | 53.78% |
| Item | The Company | TASI |
|---|---|---|
| YTD | (16.89 %) | 6.37 % |
| Change(12M) | (8.70 %) | (18.83 %) |
| Previous Close | 36.20 | 11,218.61 |
| P/E adjusted (x) | 13.56 | 21.59 |
| EPS (TTM) before unusual items (SAR/Share) | 2.35 | - |
| P/E (TTM) | 8.30 |
| P/E Before Unusual Items (TTM) | 8.30 |
| P/BV | 1.08 |
| Dividend Yield | 4.91 % |
| Market Cap. (M) | 64,726.20 |
| Return on Average Assets | 2.12 % |
| Return on Average Equity | 13.48 % |
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