RIYADH, April 17 (Reuters) - Banque Saudi Fransi posted a drop in first-quarter net profit, becoming the fourth listed Saudi lender to be hit by a decline in lending income.
Fransi, in which French Calyon holds a 31.1-percent stake, made a net profit of 714 million riyals ($190.4 million) in the three months to end-March, down from 741 million riyals a year earlier.
The earnings came close to the highest of forecasts by three analysts in a Reuters survey this month.
The bank's operating income inched down 0.6 percent to 1.07 billion riyals after lending income slid 5.7 percent to 723 million riyals.
The loans portfolio fell 1.2 percent to 80 billion riyals while deposits fell 4.3 percent to 88 billion riyals.
Profits at most Saudi banks came under pressure in 2009 from provisions to counter exposure to some troubled Saudi firms and also from flat credit growth as lenders restricted loans during the global slowdown.
The slowdown in lending income -- as shown by first-quarter earnings -- indicated that most banks remain cautious until the global financial system strengthens its recovery, said Hesham Abu Jamea of Bakheet Investment Group.
Fransi raised net income from non-lending operations by 12.2 percent in the first-quarter to 349 million riyals, according to Reuters calculations, but operating costs rose 6.3 percent in the same quarter to 358 million riyals.
Fransi did not disclose the amount of first quarter provisions -- which include non-performing loans and investment.
Fransi was among banks that best covered with provisions their non-performing loans, which surged in 2009. It raised provisions by 51 percent to 1.28 billion riyals in 2009 to cover bad loans which rose 32.2 percent to 1.01 billion riyals.
Earnings per share fell to 0.99 riyal in the first quarter from 1.02 riyal a year earlier.
Shares in Fransi have gained 13 percent this year, slightly outperforming both the Saudi bourse's all-share index and the banking stocks index.
(Reporting by Souhail Karam, Editing by Tamara Walid) ($1=3.750 Saudi riyals) Keywords: SAUDIFRANSI EARNINGS (souhail.karam@thomsonreuters.com, +966 1 463 2603; Reuters Messaging: souhail.karam.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
Fransi, in which French Calyon holds a 31.1-percent stake, made a net profit of 714 million riyals ($190.4 million) in the three months to end-March, down from 741 million riyals a year earlier.
The earnings came close to the highest of forecasts by three analysts in a Reuters survey this month.
The bank's operating income inched down 0.6 percent to 1.07 billion riyals after lending income slid 5.7 percent to 723 million riyals.
The loans portfolio fell 1.2 percent to 80 billion riyals while deposits fell 4.3 percent to 88 billion riyals.
Profits at most Saudi banks came under pressure in 2009 from provisions to counter exposure to some troubled Saudi firms and also from flat credit growth as lenders restricted loans during the global slowdown.
The slowdown in lending income -- as shown by first-quarter earnings -- indicated that most banks remain cautious until the global financial system strengthens its recovery, said Hesham Abu Jamea of Bakheet Investment Group.
Fransi raised net income from non-lending operations by 12.2 percent in the first-quarter to 349 million riyals, according to Reuters calculations, but operating costs rose 6.3 percent in the same quarter to 358 million riyals.
Fransi did not disclose the amount of first quarter provisions -- which include non-performing loans and investment.
Fransi was among banks that best covered with provisions their non-performing loans, which surged in 2009. It raised provisions by 51 percent to 1.28 billion riyals in 2009 to cover bad loans which rose 32.2 percent to 1.01 billion riyals.
Earnings per share fell to 0.99 riyal in the first quarter from 1.02 riyal a year earlier.
Shares in Fransi have gained 13 percent this year, slightly outperforming both the Saudi bourse's all-share index and the banking stocks index.
(Reporting by Souhail Karam, Editing by Tamara Walid) ($1=3.750 Saudi riyals) Keywords: SAUDIFRANSI EARNINGS (souhail.karam@thomsonreuters.com, +966 1 463 2603; Reuters Messaging: souhail.karam.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.