Saudi National Bank (SNB), the largest bank in Saudi Arabia in terms of assets, reported a robust 7.7% increase in its net profit for the full year of 2023, marking a significant uptick from the previous year. The bank’s net profit reached 20.01 billion riyals ($5.34 billion), surpassing the average analyst estimate of 19.5 billion riyals, as per data from the London Stock Exchange Group (LSEG). This positive performance underscores SNB’s resilience and effectiveness in navigating the evolving economic landscape.
In the fourth quarter alone, SNB’s net profit, calculated to be approximately 4.96 billion riyals according to Reuters, demonstrated steady growth compared to the corresponding period in the previous year, reflecting the bank’s sustained momentum and strategic execution. Notably, SNB’s nine-month profit stood at 15.05 billion riyals, indicating a consistent performance trajectory throughout the year.
Driving SNB’s strong financial results was a nearly 5% increase in operating income, attributed to higher fees from banking services and augmented investment income. Concurrently, the bank experienced a substantial 45% reduction in provisions for non-performing loans, totaling 923 million riyals as of December 31, 2023. This decline in impairment charges signifies effective risk management practices and asset quality preservation by SNB.
SNB’s robust performance in 2023 can also be attributed to a notable 45% surge in special commission income from financing, amounting to 38.5 billion riyals. This increase was fueled by a 10% expansion in the bank’s financing portfolio and favorable movements in benchmark interest rates. The growth in lending activities is indicative of SNB’s proactive approach to meeting the evolving financial needs of its clientele while capitalizing on prevailing market conditions.
Moreover, SNB witnessed substantial growth in its loan portfolio, with loans and advances reaching 601.5 billion riyals by the end of December 2023, reflecting a notable 10.3% year-on-year increase. This expansion underscores the bank’s commitment to facilitating economic growth and supporting businesses and individuals through access to credit facilities.
Additionally, customer deposits experienced a healthy uptick, growing by 3.8% during the same period, further bolstering SNB’s liquidity position and funding base. The steady growth in deposits underscores the confidence and trust placed by customers in SNB’s stability and reliability as a financial institution.
Furthermore, SNB’s total assets surged by 10% in 2023, surpassing the significant milestone of 1 trillion riyals. This milestone reflects SNB’s formidable market presence and underscores its role as a key player in driving economic activity and financial intermediation within Saudi Arabia and beyond.
In summary, Saudi National Bank’s impressive financial performance in 2023, characterized by robust profit growth, prudent risk management, and strategic business expansion, reaffirms its position as a leading financial institution in the region. With a solid foundation and proactive approach, SNB is well-positioned to capitalize on future opportunities and continue delivering sustainable value to its stakeholders amidst evolving market dynamics.
