Fitch Ratings upgraded Saudi National Bank's outlook from negative to stable, citing its resilient financial metrics and an improving operating environment.
The credit rating agency also affirmed the lender’s long-term issuer default rating at "A-". It assigned a national long-term investment grade rating of "AA+(sau)" with a stable outlook.
“The revision of the outlook reflects our view that pressures on the operating environment from the pandemic and lower oil prices have eased sufficiently, and that the financial metrics of the bank have been resilient in the past quarters, despite these pressures,” Fitch said.
“Strong financing growth will continue to support the bank’s metrics in 2021.”
The lender's first-quarter net profit jumped 20 per cent to 3.4 billion Saudi riyals ($907 million), boosted by higher fee income and lower impairment charges as the kingdom’s economy recovers from the Covid-19 pandemic.
Brent, the international benchmark for up to two thirds of the world’s oil, rose by 0.59 per cent to close at $73.51 on Friday, the end of trading week. West Texas Intermediate, the gauge for US crude, was up 0.84 per cent to close at $71.64.
Fitch said SNB’s "A-" viability rating, which represents its view of the lender’s creditworthiness, was underpinned by “a strong company profile supporting well-diversified and resilient earnings, strong funding and liquidity, as well as sound asset quality and capitalisation”.
SNB, Saudi Arabia's biggest lender, was created through the merger of National Commercial Bank and smaller rival Samba Financial Group. It began to operate on April 1 and has more than 896bn riyals ($239.2bn) in assets.
The bank's exposure to the retail segment fell from 50 per cent to 39 per cent of total loans at the end of last year as a result of Samba’s strong corporate focus, the credit rating agency said.
SNB's retail loans are expected to rise between this year and 2022 due to a high appetite for that segment, supported by a strong domestic franchise, said Fitch.
“We believe the strengthening of the franchise, fostering non-interest bearing customer deposits and rapid loan growth in the high-yielding mortgage segment will support SNB’s earnings generation,” the rating agency said.
In addition to improving business conditions, this should support a recovery in the core profitability measure by 2022, it said.
The Public Investment Fund, the kingdom’s sovereign wealth fund, is the biggest shareholder in SNB with a 37.2 per cent stake. The Public Pension Agency has 7.4 per cent and the General Organisation for Social Insurance owns 5.8 per cent of the lender.
Saudi Arabia said last week that it is merging general insurance and public pension funds to create a public sector entity with $29bn in domestic and foreign stock holdings.
The combination of the two state-run funds is an extension of “continuous reforms” and part of an organisational restructuring process, in line with the kingdom’s Vision 2030 objectives, Minister of Finance Mohammed Al Jadaan, said on Thursday.
The specs
- Engine: 3.9-litre twin-turbo V8
- Power: 640hp
- Torque: 760nm
- On sale: 2026
- Price: Not announced yet
Dubai works towards better air quality by 2021
Dubai is on a mission to record good air quality for 90 per cent of the year – up from 86 per cent annually today – by 2021.
The municipality plans to have seven mobile air-monitoring stations by 2020 to capture more accurate data in hourly and daily trends of pollution.
These will be on the Palm Jumeirah, Al Qusais, Muhaisnah, Rashidiyah, Al Wasl, Al Quoz and Dubai Investment Park.
“It will allow real-time responding for emergency cases,” said Khaldoon Al Daraji, first environment safety officer at the municipality.
“We’re in a good position except for the cases that are out of our hands, such as sandstorms.
“Sandstorms are our main concern because the UAE is just a receiver.
“The hotspots are Iran, Saudi Arabia and southern Iraq, but we’re working hard with the region to reduce the cycle of sandstorm generation.”
Mr Al Daraji said monitoring as it stood covered 47 per cent of Dubai.
There are 12 fixed stations in the emirate, but Dubai also receives information from monitors belonging to other entities.
“There are 25 stations in total,” Mr Al Daraji said.
“We added new technology and equipment used for the first time for the detection of heavy metals.
“A hundred parameters can be detected but we want to expand it to make sure that the data captured can allow a baseline study in some areas to ensure they are well positioned.”
Benefits of first-time home buyers' scheme
- Priority access to new homes from participating developers
- Discounts on sales price of off-plan units
- Flexible payment plans from developers
- Mortgages with better interest rates, faster approval times and reduced fees
- DLD registration fee can be paid through banks or credit cards at zero interest rates
What is Diwali?
The Hindu festival is at once a celebration of the autumn harvest and the triumph of good over evil, as outlined in the Ramayana.
According to the Sanskrit epic, penned by the sage Valmiki, Diwali marks the time that the exiled king Rama – a mortal with superhuman powers – returned home to the city of Ayodhya with his wife Sita and brother Lakshman, after vanquishing the 10-headed demon Ravana and conquering his kingdom of Lanka. The people of Ayodhya are believed to have lit thousands of earthen lamps to illuminate the city and to guide the royal family home.
In its current iteration, Diwali is celebrated with a puja to welcome the goodness of prosperity Lakshmi (an incarnation of Sita) into the home, which is decorated with diyas (oil lamps) or fairy lights and rangoli designs with coloured powder. Fireworks light up the sky in some parts of the word, and sweetmeats are made (or bought) by most households. It is customary to get new clothes stitched, and visit friends and family to exchange gifts and greetings.
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Killing of Qassem Suleimani
Tearful appearance
Chancellor Rachel Reeves set markets on edge as she appeared visibly distraught in parliament on Wednesday.
Legislative setbacks for the government have blown a new hole in the budgetary calculations at a time when the deficit is stubbornly large and the economy is struggling to grow.
She appeared with Keir Starmer on Thursday and the pair embraced, but he had failed to give her his backing as she cried a day earlier.
A spokesman said her upset demeanour was due to a personal matter.
