The aggregate net profit of Saudi Arabia's 10 largest banks rose by 3.8 per cent on a quarterly basis in the third quarter, on the back of higher interest income and lower impairment charges, with moderated credit growth expected in the last three months of the year.
Cumulative net profit for the three months to the end of September climbed to 18 billion riyals ($4.8 billion), professional services consultancy Alvarez & Marsal said on Sunday.
Total net interest income grew 3.8 per cent quarter-on-quarter, while impairment charges fell 17.9 per cent, boosting the profits of the lenders during the period.
“Despite a slower uptick in deposits, operating income saw a positive trajectory, primarily fuelled by the growth in net interest income,” said Asad Ahmed, managing director and head of Middle East financial services at Alvarez & Marsal.
“While there have been challenges reflected in the deteriorating cost-to-income ratio, the broader improvement in profitability ratios signals continued positive performance.”
Net interest income rose as Gulf-based banks continued to increase interest rates in tandem with the US Federal Reserve.
Most regional central banks peg their currencies to the US dollar and follow the Fed's moves on interest rate increases.
The Fed has aggressively increased its benchmark policy rates over the past several quarters in an attempt to bring inflation down to its 2 per cent range.
The loan-to-deposit ratio (LDR) for the top 10 Saudi lenders improved by 2.3 per cent quarter-on-quarter since loans and advances grew to 98.4 per cent, representing the highest level seen in the last four years, the consultancy said.
Loans and advances increased at a faster pace of 2.9 per cent on a quarterly basis than deposits growth at 0.5 per cent.
“We anticipate moderate credit growth in the fourth quarter of 2023, as ... banks are increasingly turning to medium-term borrowing to address the liquidity constraints resulting from high LDR and this is likely to affect NIM (net interest margin)," Mr Ahmed said.
"However, the diversification of the non-oil sector such as trade, hospitality, and tourism, coupled with ongoing government spending, positions the kingdom well for a positive economic counterbalance."
Saudi Arabia is focusing on boosting non-oil growth as it aims to diversify its economy, developing new projects in tourism and real estate.
These include the $500 billion Neom mega project along the Red Sea coast as well as Qiddiya entertainment city and the Diriyah Gate heritage development.
Saudi Arabia's non-oil economy grew at its fastest pace in four months in October, with business activity continuing to grow in the fourth quarter on higher client orders and improving economic conditions.
The headline Riyad Bank purchasing managers' index reading climbed to 58.4 in October, up from 57.2 in September, the highest level since June.
Alvarez & Marsal's survey covered the kingdom's 10 largest listed banks: Saudi National Bank, Al Rajhi Bank, Riyad Bank, Saudi British Bank, Banque Saudi Fransi, Arab National Bank, Alinma Bank, Bank Albilad, Saudi Investment Bank and Bank Aljazira.
Jeff Buckley: From Hallelujah To The Last Goodbye
By Dave Lory with Jim Irvin
Which honey takes your fancy?
Al Ghaf Honey
The Al Ghaf tree is a local desert tree which bears the harsh summers with drought and high temperatures. From the rich flowers, bees that pollinate this tree can produce delicious red colour honey in June and July each year
Sidr Honey
The Sidr tree is an evergreen tree with long and strong forked branches. The blossom from this tree is called Yabyab, which provides rich food for bees to produce honey in October and November. This honey is the most expensive, but tastiest
Samar Honey
The Samar tree trunk, leaves and blossom contains Barm which is the secret of healing. You can enjoy the best types of honey from this tree every year in May and June. It is an historical witness to the life of the Emirati nation which represents the harsh desert and mountain environments
Fixtures (6pm UAE unless stated)
Saturday Bournemouth v Leicester City, Chelsea v Manchester City (8.30pm), Huddersfield v Tottenham Hotspur (3.30pm), Manchester United v Crystal Palace, Stoke City v Southampton, West Bromwich Albion v Watford, West Ham United v Swansea City
Sunday Arsenal v Brighton (3pm), Everton v Burnley (5.15pm), Newcastle United v Liverpool (6.30pm)
German intelligence warnings
- 2002: "Hezbollah supporters feared becoming a target of security services because of the effects of [9/11] ... discussions on Hezbollah policy moved from mosques into smaller circles in private homes." Supporters in Germany: 800
- 2013: "Financial and logistical support from Germany for Hezbollah in Lebanon supports the armed struggle against Israel ... Hezbollah supporters in Germany hold back from actions that would gain publicity." Supporters in Germany: 950
- 2023: "It must be reckoned with that Hezbollah will continue to plan terrorist actions outside the Middle East against Israel or Israeli interests." Supporters in Germany: 1,250
Source: Federal Office for the Protection of the Constitution
Infiniti QX80 specs
Engine: twin-turbocharged 3.5-liter V6
Power: 450hp
Torque: 700Nm
Price: From Dh450,000, Autograph model from Dh510,000
Available: Now
WHAT IS A BLACK HOLE?
1. Black holes are objects whose gravity is so strong not even light can escape their pull
2. They can be created when massive stars collapse under their own weight
3. Large black holes can also be formed when smaller ones collide and merge
4. The biggest black holes lurk at the centre of many galaxies, including our own
5. Astronomers believe that when the universe was very young, black holes affected how galaxies formed
EA Sports FC 26
Publisher: EA Sports
Consoles: PC, PlayStation 4/5, Xbox Series X/S
Rating: 3/5
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Where to donate in the UAE
The Emirates Charity Portal
You can donate to several registered charities through a “donation catalogue”. The use of the donation is quite specific, such as buying a fan for a poor family in Niger for Dh130.
The General Authority of Islamic Affairs & Endowments
The site has an e-donation service accepting debit card, credit card or e-Dirham, an electronic payment tool developed by the Ministry of Finance and First Abu Dhabi Bank.
Al Noor Special Needs Centre
You can donate online or order Smiles n’ Stuff products handcrafted by Al Noor students. The centre publishes a wish list of extras needed, starting at Dh500.
Beit Al Khair Society
Beit Al Khair Society has the motto “From – and to – the UAE,” with donations going towards the neediest in the country. Its website has a list of physical donation sites, but people can also contribute money by SMS, bank transfer and through the hotline 800-22554.
Dar Al Ber Society
Dar Al Ber Society, which has charity projects in 39 countries, accept cash payments, money transfers or SMS donations. Its donation hotline is 800-79.
Dubai Cares
Dubai Cares provides several options for individuals and companies to donate, including online, through banks, at retail outlets, via phone and by purchasing Dubai Cares branded merchandise. It is currently running a campaign called Bookings 2030, which allows people to help change the future of six underprivileged children and young people.
Emirates Airline Foundation
Those who travel on Emirates have undoubtedly seen the little donation envelopes in the seat pockets. But the foundation also accepts donations online and in the form of Skywards Miles. Donated miles are used to sponsor travel for doctors, surgeons, engineers and other professionals volunteering on humanitarian missions around the world.
Emirates Red Crescent
On the Emirates Red Crescent website you can choose between 35 different purposes for your donation, such as providing food for fasters, supporting debtors and contributing to a refugee women fund. It also has a list of bank accounts for each donation type.
Gulf for Good
Gulf for Good raises funds for partner charity projects through challenges, like climbing Kilimanjaro and cycling through Thailand. This year’s projects are in partnership with Street Child Nepal, Larchfield Kids, the Foundation for African Empowerment and SOS Children's Villages. Since 2001, the organisation has raised more than $3.5 million (Dh12.8m) in support of over 50 children’s charities.
Noor Dubai Foundation
Sheikh Mohammed bin Rashid Al Maktoum launched the Noor Dubai Foundation a decade ago with the aim of eliminating all forms of preventable blindness globally. You can donate Dh50 to support mobile eye camps by texting the word “Noor” to 4565 (Etisalat) or 4849 (du).
What are the GCSE grade equivalents?
- Grade 9 = above an A*
- Grade 8 = between grades A* and A
- Grade 7 = grade A
- Grade 6 = just above a grade B
- Grade 5 = between grades B and C
- Grade 4 = grade C
- Grade 3 = between grades D and E
- Grade 2 = between grades E and F
- Grade 1 = between grades F and G
UAE currency: the story behind the money in your pockets
PROFILE OF INVYGO
Started: 2018
Founders: Eslam Hussein and Pulkit Ganjoo
Based: Dubai
Sector: Transport
Size: 9 employees
Investment: $1,275,000
Investors: Class 5 Global, Equitrust, Gulf Islamic Investments, Kairos K50 and William Zeqiri
