Saudi Banks - 2017 Results Dashboard

...] Sector Returns to Profit Growth as Liquidity Eases Key Message on 2017: The Saudi Arabian banking sector returned to operating profit growth in 2017, thanks largely to the easing of liquidity conditions and reduced funding costs. However, there were still challenges, including rising impairment charges and limited growth opportunities. The loan books of the 11 Fitch-rated Saudi banks contracted by 2% in 2017. Lower Cost of Funding: Operating profit for rated Saudi banks (over 95% of the sector) increased by 9% in 2017 (2016: 4% decline). A reduction in funding costs of 13% was the main driver, as banks were able to shed expensive deposits on-boarded during 2016, an illustration of better liquidity conditions. Interest income (up 4%) also benefitted from successful repricing of the loan books, while good cost control (4% decrease in operating expenses) highlighted sound discipline. Operating return on risk-weighted assets of 2.3% compares well internationally, particularly considering...

Special Report