Banking study on STC
HSBC Holding, associate of the Saudi British Bank, (manager of STC IPO) has conducted a study on the Saudi Telecommunication Company on the occasion of the commencement of STC IPO. The study focused on the following points:
A period of change
Since its incorporation in May 1998, the company has set in motion a number of restructuring efforts that are beginning to show returns. These include a renewed customer focus, internal restructuring and cost discipline. The results of these initiatives have included a 50% reduction in connection waiting time, a centralised procurement process (important, given that HSBC expects STC to be spending more than SAR25bn in capital expenditure over the next five years), and an estimated SAR380m annual saving from the Early Retirement Programme.
STC currently has a nine-member board of directors (with both public and private sector representation). Board members are also organised into four standing (permanent) committees covering issues such as strategy, tariff setting and audit. A large part of the restructuring seen on both the internal (centralised procurement process) and external (tariff rebalancing) fronts has been the result of recommendations made by these committees.
Network and growth
STC’s fixed-line service network will have some 3.5m lines (by end FY02) into homes, businesses and government offices, while its mobile service offering (Al Jawal is the fully owned mobile business for STC) is expected to finish 2002 with just over 5.2m users. HSBC expects subscribers to the company’s internet service to total some 650,000 (including subscribers logging on through other ISPs) by end-2002. The growth rates in service users currently being experienced by STC (and in particular with respect to mobile) are expected to be the key drivers of the business over the next 3-5 years.
HSBC sees considerable growth potential
Our analysis of STC’s fixed-line and mobile network shows considerable growth potential. Penetration rates for STC are well below the mark suggested by our regression analysis of GDP/capita against penetration rates in other regional countries. HSBC now expects the renewed strategic focus that appears to have been engineered post STC’s corporatisation to work to push penetration rates to levels that would place STC on a par with the other regional telecoms. Our regression analysis shows a potential growth of 36% for fixed line (increasing penetration rates from the current 15.4% to 21%) and a more than doubling of mobile penetration rates (from 12% to 30%) in order for STC to be on a par with other regional operators. This dynamic is, in turn, expected to be the key driver behind revenue, profits and ultimately shareholder returns over the next 3-5 years.
The onset of competition
The Saudi telecom sector is to undergo managed deregulation over the next six years. This is expected to result in competition in the mobile segment of the market by the last quarter of 2004, while the fixed-line business is expected to be open to competition by 2008. The terms of engagement for competition are currently being discussed between the company and Saudi Communications Commission (SCC). HSBC expects the mobile business to attract most interest from newcomers, and regard the likely description of competition to include local equity and international expertise.
Valuation
HSBC’s discounted cash flow (DCF) analysis on STC’s business yields a fair value of SAR203 per share. This is a 19.6% premium to the announced secondary placement price of SAR170 per share. The table below shows a number of the more popular relative value measures for STC at both our fair value assessment price and at the issue price.
Relative value multiples at SAR203
|
|
2001a |
2002e |
2003e |
2004e |
2005e |
|
Price/Revenue |
3.08 |
2.54 |
2.14 |
1.98 |
1.94 |
|
PE |
17.51 |
12.91 |
6.58 |
5.78 |
5.70 |
|
PCF |
12.94 |
15.53 |
5.70 |
5.07 |
5.23 |
|
Yield |
1.5% |
3.7% |
7.4% |
8.6% |
9.9% |
|
PBV |
2.97 |
2.35 |
1.98 |
1.69 |
1.50 |
|
EV/Revenue |
3.08 |
2.43 |
1.89 |
1.56 |
1.38 |
|
EV/EBITDA |
6.96 |
5.78 |
3.66 |
3.04 |
2.70 |
Source: HSBC
Relative value multiples at SAR170
|
|
2001a |
2002e |
2003e |
2004e |
2005e |
|
Price/Revenue |
2.58 |
2.12 |
1.79 |
1.66 |
1.63 |
|
PE |
14.66 |
10.81 |
5.51 |
4.84 |
4.78 |
|
PCF |
10.84 |
13.01 |
4.77 |
4.25 |
4.38 |
|
Yield |
1.8% |
4.4% |
8.8% |
10.3% |
11.8% |
|
PBV |
2.49 |
1.97 |
1.66 |
1.42 |
1.25 |
|
EV/Revenue |
2.58 |
2.02 |
1.54 |
1.24 |
1.07 |
|
EV/EBITDA |
5.83 |
4.80 |
2.99 |
2.41 |
2.08 |
Source: HSBC
Post its listing at SAR170 per share, STC is expected to become the largest company on the Saudi equity market with a capitalisation of SAR51bn (USD13.6bn). At this level, and using equity prices as of 27 November 2002, the company is expected to represent 16% of the index by capitalisation. SABIC would stand as the second, with a capitalisation of SAR44bn (USD11.8bn) and an index representation of 13.8%. HSBC would expect this dominant position to translate into active daily trading for the stock.
HSBC’s review of the Tadawul All-Share Index shows the general market index trading at a trailing PE of 22.9x for FY 2001. At SAR170 per share, STC trades at a 36% discount to this trailing general index PE multiple. This discount narrows to 23% with a stock price of SAR203 per share. In our view, any such discount to the general market index is unjustified given STC’s (a) superior quality of earnings and (b) greater earnings growth prospects in comparison with the general index earnings. HSBC therefore expects the relatively ‘rich’ equity valuations in Saudi to carry STC’s stock price above our fair value assessed target.
December 16, 2002
SABB Sponsors SME Seminar
The Saudi British Bank (SABB) will co-sponsor the seminar “Small & Medium Enterprises (SME): Status, problems and ways to support them”, to be organised under the patronage of HH Prince Abdullah Bin Faisal Bin Turki Al Saud, Governor -- Saudi Arabian General Investment Authority, by the Chamber of Commerce & Industry in Riyadh in collaboration with the Saudi Management Society and the Arab Administrative Development Organisation.
Mr David Hodgkinson, Managing Director – SABB, commenting on the event, said: “SABB’s co-sponsorship of this important event is part of the Bank’s plans to support the development of SME sector. During this important three-day seminar experts from a number of Arab countries, including Saudi Arabia, will discuss ways to enhance the performance of SMEs, define the key elements in this regard, and deliberate on means to incorporate these elements into the SME sector in the Kingdom.”
“SABB realises that SMEs can play a vital role in the economic development of the Kingdom, so the Bank is keen to actively participate in assisting these enterprises,” Mr Hodgkinson added, “and this seminar will play an important role in highlighting the problems faced by this sector and try to find solutions for the same.”
On this note, SABB recently financed a visit by a delegation of British experts to Riyadh for focussed studies on SMEs and the means by which both public and private sector could support these enterprises. The delegation had submitted the results and its recommendations to the Economic Forum organised recently in Riyadh by the Ministry of Planning.
December 2, 2002
Governor of Jizan Honours SABB
HRH Prince Mohammed Bin Nasser Bin Abdul Aziz, Governor of Jizan, presented The Saudi British Bank (SABB) a shield of appreciation honouring the Bank’s contribution and support to the ‘Wassal’ charity campaign organised under the patronage of the wife of King Fahd The Custodian of the Two Holy Mosques, Princess Al Jawhara Bint Ibrahim Al Ibrahim.
Mr Waleed A Kayyal, Regional General Manager Financial Services Western Province, who had participated in the campaign’s final activities received the shield on behalf of SABB. The campaign was organised by the Al Nahda Philanthropic Society for Women to aid the widows and orphans of those who had died due to Rift-valley fever in Jizan region. SABB, conscious of its social role, keenly supports various charitable activities of this society and is also engaged in a number of other programmes serving different segments of the Saudi community.
October 29, 2002.
SABB Hosts Security & Investigation Financial Course Delegates
The Saudi British Bank (SABB) received a delegation from the 9th Qualifying Financial Training Course to Security & Investigation sectors organized by SAMA’s Institute of Banking (IOB) today, Sunday, October 20th 2002. The trainees will utilise the visit to acquaint themselves with the Bank’s advanced mechanisms and procedures to contain fraud, money laundering, etc. and will have extensive interaction with SABB’s legal and audit department staff.
Mr Abdulaziz Al Manie, Senior Manager Public Affairs – SABB, welcoming the IOB delegation stressed the Bank’s interest in encouraging such visits and said: “ I urge all the delegates to avail of this opportunity to your maximum benefit by studying closely SABB’s procedures in controlling fraud and money laundering.”
Mr Al Manie also praised SAMA officials who had been keen to conduct such courses along with national banks because these courses strengthened the regulatory procedures of the Saudi banking sector, even while enhancing the cooperation and coordination between banks and the Security & Investigation sectors.
October 19, 2002
Al Amanah Trading Funds Launched
The Al Amanah Islamic Banking Division of the Saudi British (SABB) has recently launched two Shariah-compliant funds: the SAR Trading Fund and the USD Trading Fund, both endorsed by the Bank’s Shariah Supervising Committee.
These funds offer investors a short-term investment vehicle with high liquidity and are open to all investors with a minimum subscription of SAR 7500 or USD 2,000. Investors will be able to subscribe, redeem or increase their investments twice a week.
Both funds offer an interesting feature, which is, regular monthly subscription. In addition to the growth in their investment the investors have the option to subscribe to the funds on a regular basis thus enhancing the investment and returns.
October 13, 2002
The Saudi British Bank Third Quarter 2002 Results
Highlights
Commentary
The Saudi British Bank (SABB) recorded a net profit of SAR736 million (US$196 million) for the nine months ended 30 September 2002. This represents an increase of 15.2 per cent over the SAR639 million (US$170 million) earned in the same period in 2001. Earnings per share increased to SAR18.39 (US$4.90) compared to SAR15.97 (US$4.26) for the same period last year.
Customer deposits increased to SAR34.2 billion (US$9.1 billion) at 30 September 2002 from SAR29.8 billion (US$7.9 billion) at 30 September 2001, reflecting increased liquidity in the market.
Loans and advances to customers were higher at SAR19.3 billion (US$5.1 billion) at 30 September 2002 from SAR16.5 billion (US$4.4 billion) at 30 September 2001, reflecting growth in the corporate and Al Amanah Islamic banking products.
The bank’s investment portfolio totaled SAR19.4 billion (US$5.2 billion) at 30 September 2002, a decrease from SAR22.1 billion (US$5.9 billion) at 30 September 2001, as the bank increased liquidity in light of increased uncertainty in world financial markets.
David Hodgkinson, managing director, said: “Despite continuing uncertainty in financial markets around the world, the domestic market remained stable and our results for the nine months ended 30 September 2002 are encouraging. Net commission and non-fund income continue to grow, while operating costs have been contained. Capital and liquidity ratios remain strong.
“In July, the bank opened a new Al Amanah Islamic branch in Madinah, and continues to expand the Al Amanah range of Islamic banking products available to its customers. The bank is also committed to continually improving customer service, illustrated by the recent introduction of a 24-hour automated cash deposit service which is the first of its kind in the Kingdom of Saudi Arabia.
“We would like to thank our customers for their continuing support, and our staff for their commitment and contribution to the bank’s success.”
Media enquiries to Abdulaziz Al-Manie [966] (1) 405-0677 Ext,4310
or at abdulazizalmaniea@sabb.com
Click here for Year 2002 Third Quarter Financial Statements
October 9, 2002
SABB Participates in SAGIA Malaysia Conference
The Saudi British Bank (SABB) has sponsored the “Opportunities for Business & Investment with Saudi Arabia” conference held under the patronage of the Saudi Arabian General Investment Authority (SAGIA) in Malaysia recently aimed at offering investors in Asia-Pacific the occasion to learn more about the investment climate in Saudi Arabia.
Mr Waleed A Kayyal, SABB Regional General Manager, Financial Services – Western Province, in a speech during the conference highlighted the project finance options available in the Kingdom for mega-projects to small & medium enterprises and the role played by SABB in facilitating business between the Asia-Pacific region and Saudi Arabia.
Mr David Hodgkinson, SABB Managing Director said. “Participating in this important conference held under the patronage of HH Prince Abdullah Bin Faisal Bin Turki Al Saudi, SAGIA Governor, is a part of SABB’s commitment to the advancement of investment in the Saudi economy. And, to this end, we have brought to the notice of investors the variety of investment options available in different sectors of the Saudi economy including minerals; oil & gas; communication; and information technology sectors.”
September 25, 2002
SABB Introduces Automated Cash Deposit Machines In Kingdom
The Saudi British Bank (SABB) has announced the introduction of a new 24-hour service in the Saudi market – the automated cash deposit service via Cash Deposit Machines.
Sulaiman Al Hamdan, Deputy Managing Director Financial Services, commenting on the new service said: “ SABB is committed to introducing the latest technology in the Saudi market to ensure more convenience for our customers. By being the only bank which offers this service in the Saudi market SABB has reinforced its role of being a pioneer in introducing the latest banking services in the Kingdom.”
The new Cash Deposit Machine will enable both SABB customers and non-customers to deposit cash in any account with SABB, which will be automatically credited to the designated account. The machine offers easy and quick service, and also ensures confidentiality. For instance, it will not display the account balance if the depositor is not the account holder.
August 28, 2002
SABB, Jazirah Vehicles Tie Up For Installment Sales
The Saudi British Bank (SABB) represented by its Al Amanah Islamic Banking Division has signed an agreement with Al Jazirah Vehicles Agencies Company Ltd., the sole distributors of Ford and Lincoln in the Kingdom, for an installment sale program named, “Acquire And Drive”.
Both Saudis and expatriates who wish to own Ford and Lincoln cars are offered a number of advantages and easy installment terms under the “Acquire and Drive” program. Saudis who have been working for the past one year with the present employer earning a basic minimum salary of SAR 3,000 can avail of the program. The amount financed can range from SAR 40,000 to SAR 750,000 while the repayment period will be between 12 and 72 months.
Expatriates qualifying for the program would earn a minimum salary of SAR 8,000, and would be financed anywhere between SAR 40,000 and SAR 100,000 with a repayment schedule of 12 to 36 months.
SABB Al Amanah Banking Division offers a number of other advanced banking services, which are compliant with Islamic Shariah through a number of designated branches and sections under the supervision of a Shariah Committee.
August 24, 2002
Excellent Response For SABB Officers Training Progamme
A Junior Officer Development Programme (JODP) initiated by The Saudi British Bank (SABB) for Saudi graduates has met with excellent response, attracting a large number of applicants.
Mr Bleihid N Al Bleihid, General Manager Human Resources, expressing satisfaction at the high response said: “The JODP aims at developing the capabilities of the Saudi cadre in various units of the Bank, providing them advanced training within and outside the Kingdom. The trainee also undergoes on the job training covering all aspects of banking in addition to enhancement of leadership skills and financial analysis abilities for a one year period.
Mr Bleihid added, “ SABB has a clear policy of attracting qualified and experienced Saudi cadre and providing them with training to enhance their skills under a number of programmes in addition to JODP. For this, SABB has set up a well entrenched strategy of continuously developing its Saudisation initiatives. Saudisation is promoted in all its departments, with unlimited support for its training programmes having realized that real Saudisation is not possible without training”.
SABB’s success in Saudisation can be gauged from the 77% Saudisation ratio it has recorded at the end of June 2002. Saudi staff are now placed in the Bank’s leading positions and actively participate in decision making. SABB is particularly proud of maintaining a 100% Saudisation record among it ladies staff, who now represent 11% of the Bank work force.
August 13, 2002
SABB Opens Second Islamic Branch In Medinah
The Saudi British Bank (SABB) has officially opened an Al Amanah Islamic Branch at King Abdul Aziz Street in Medinah, in a ceremony attended by the Bank’s Shariah Committee members: Sh. Abdullah Bin Manea, Member Board of Senior Scholars Committee for Fatwa, Sh. Dr Abdullah Al Mutlaq, Professor Comparative Fiqh, Higher Judicature Institute – Imam Mohammed Bin Saud University, and Sh. Dr. Mohammed Al Gari Bin Eid, Head of Islamic Economic Center – King Abdul Aziz University in addition to a number of senior SABB and Al Amanah officials.
Members of the SABB Shariah Commttee lauded the earnest efforts by SABB to open Islamic branches and said: “The opening of the King Abdul Aziz Street branch is part of the Bank’s plan to convert a number of its existing branches to Islamic banking branches. SABB’s Islamic banking services are now available at the Rabwa branch and will be also offered from the Buraidah branch in September and later in the year from Misfalah Makkah.”
SABB also plans to offer Al Amanah Islamic banking services at 17 outlets in other branches consisting of six in Riyadh, two in Qassim, six in the Western Province and three in the Eastern Province.
The Al Amanah Islamic banking products offered by these branches include Al Amanah Current Account, Amanah VISA, Murabaha loan, Home Lease and investment funds.
July 17, 2002
The Saudi British Bank First Half 2002 Results 2002
Highlights
Commentary
The Saudi British Bank recorded a net profit of SAR486.7 million (US$129.8 million) for the six months ended 30 June 2002. This represents an increase of 15.2 per cent over the SAR422.5 million (US$112.7 million) earned in the same period in 2001. Earnings per share increased to SAR12.17 (US$3.25) compared to SAR10.56 (US$2.82) for the same period last year.
Customer deposits increased to SAR33.1 billion (US$8.8 billion) at 30 June 2002 from SAR30.5 billion (US$8.1 billion) at 30 June 2001, reflecting increased liquidity in the market.
Loans and advances to customers were higher at SAR18.6 billion (US$5.0 billion) at 30 June 2002 from SAR16.1 billion (US$4.3 billion) at 30 June 2001 as personal credit growth remained robust and growth in corporate credit was achieved.
The bank’s investment portfolio totalled SAR21.5 billion (US$5.7 billion) at 30 June 2002, a small increase from SAR21.4 billion (US$5.7 billion) at 30 June 2001.
David Hodgkinson, managing director, said: “Our results for the first six months are encouraging. Operating revenues, excluding gains on investments, continue to grow despite the low interest rate environment. While operating costs were contained, our capital and liquidity ratios remain sound.
“Our Al Amanah range of Islamic banking products has been well-received. We now have three branches dedicated to this area, in addition to 17 outlets which also provide Al Amanah banking services.
“Earlier this year, the bank’s mutual funds won 14 awards, including nine first places, at the annual Investment Fund Awards presentation. One of the awards was for Best Overall Fund Manager for the one-year category in 2001. Assets under management at 30 June 2002 amounted to SAR5.4 billion, 40 per cent higher than at 30 June 2001.
“The Directors have approved the payment of a net interim dividend of SAR8.00 per share (gross dividend SAR8.31 per share). This will result in a total gross interim dividend pay out of SAR332.4 million.
“We are grateful for the support of our customers and the contribution of our staff over this period.”
Media enquiries to Abdulaziz Al-Manie [966] (1) 405-0677 Ext,4310
or at abdulazizalmaniea@sabb.com
Click here for Year 2002 First Half Financial Statements
July 9, 2002
SABB Distributes SAR332.4 Million As Gross Interim Dividend – 2002
The Board of The Saudi British Bank (SABB) has announced the distribution of a net interim dividend of SAR8 per share after deduction of Zakat. This will result in a total gross interim dividend pay out of SAR332.4 million.
Dividend cheques will be issued on Wednesday, 7 August 2002 to shareholders registered on the bank’s records on Sunday, 21 July 2002.
The dividend amount will be credited to accounts of shareholders who have instructed SABB to do so. Other shareholders who maintain accounts with SABB and wish to have their dividend amount credited to them, should provide the share registry with their account details. Dividend cheques will be sent by mail to all other shareholders with full addresses listed in the shareholders’ registry.
July 3, 2002
Prince Mugrin Opens SABB Yanbu Branch
HRH Prince Mugrin Bin Abdul Aziz, Governor Of Medinah has opened the SABB branch in Yanbu Industrial City in the presence of a number of senior officials of the region.
Mr Sulaiman Al Hamdan, Deputy Managing Director, Financial Services, speaking on the occasion said: “The opening of the branch by HRH Prince Mugrin reflects the attention paid by the government to the banking sector which is a major contributor to the national economy.”
Mr Al Hamdan expressed his pride at the achievements of SABB and added, “the Yanbu branch is managed by a team of highly capable and qualified Saudi youth who offer the highest quality of banking services.”
The new branch offers a lot of advantages including a spacious customer service area, an equity trading section, and a Premier service section for providing highly personalised service for elite customers. This is in addition to a large parking area of customer vehicles.
July 2, 2002.
190 Students Commence Summer Training At SABB
190 students, male and female, have started their summer training at The Saudi British Bank (SABB) under the summer training programme organised by the Bank every year.
Mr Bleihid N Al Bleihid, General Manager Human Resources – SABB, said: “The summer training programme aims to prepare the students for the future, helping them to develop skills for different activities at the Bank’s varied departments, and branches. Female students, meanwhile, are being trained at different Ladies Sections.”
Mr. Bleihid added, “Spending the summer training at SABB, fulfills the needs and requirements of the students, and helps in raising their knowledge and efficiency, even as they earn an appropriate remuneration during their training period.”
J une 25, 2002
Global Acceptance For SABB Travellers Cheques
With the holiday season on, the heavy demand for The Saudi British Bank’s (SABB) American Express Travellers Cheques continues. These cheques are the safest way to protect your money while travelling wherever you are. If lost or stolen, it requires just a phone call to have them replaced -- within 24 hours.
American Express Travellers Cheques are globally accepted and offer the best currency exchange rates. They can also be converted to local currency free of charge at more than 65,000 HSBC and American Express offices around the world.
The SABB American Express Travellers Cheques have no expiry dates so the unused cheques can be kept and used in any future trip. Customers buying these cheques will also receive instant gifts from SABB depending on the purchase amount.
June 19, 2002
SABB Mutual Funds Ranked First
The Saudi British Bank (SABB) has been ranked number one among all Saudi Banks at the 2001 Investment Fund Awards function winning a total of 14 Awards for best performing Mutual Funds, with nine First places including the most coveted award of the Best Overall Fund Manager for 2001 and the second best in the Three Year category.
Mr Sulaiman Al Hamdan, Deputy Managing Director, Financial Services – SABB, commenting on the Bank’s performance said: “The results achieved by SABB Funds reinforce the Bank’s distinguished position among Saudi banks. They also reflect the continued superior performance of our funds at both the local and international levels as the awards are based on results recorded in the past one and three years.”
The SABB Funds which were ranked at the top are: SAR Money Market Fund that ranked first over three years and second over one year; USD Money Market Fund which was first both for one year and three years; International Bond Fund that ranked first over three years and second over one year; Saudi Equity Fund rated first in both three years and one year; Saudi Equity Trading Fund ranked first over three years and second over one year; Asian Equity Index Fund, first over one year; and US Equity Index Fund which was ranked third over a three year period.
The ranking of the Funds were made under 16 categories on the basis of their performance for one year (2001) and three years (1988-2001) as dictated by the Investment Product Committee
June 3, 2002
SABB And Al Gosaibi Co. Mark 50 Years Of Cooperation
As a tribute to a valued and distinguished customer, The Saudi British Bank (SABB) held a party in honour of Ahmad Hamad Al Gosaibi Co. marking 50 years of close and continued cooperation between the two institutions.
The remarkable relationship commenced in 1952 with the British Bank of the Middle East (BBME) and has been continued by SABB. At the party held to mark the milestone, board members of Al Gosaibi Co. were honoured by the Bank. Present at the party were: Sh. Sulaiman Bin H. Al Gosaibi (President–Al Gosaibi Co.), Mr. Yousef A. Al Gosaibi, Mr Khalid A. Al Gosaibi, Mr Ahmed Mohsin Al Gosaibi, Mr Dawood S. Al Gosaibi, Mr Maan A. Al Sanea, Mr Mohammed Salim Al Hindi and the company’s general managers.
Representing the Bank at the party were: Mr Khalid S. Olayan (Board Member- SABB), Mr David Hodgkinson (Managing Director–SABB), Mr David Dew, Mr Sulaiman Al Hamdan, Mr Zaki Abu Al Saud. Also present were Mr Andrew Dixon (Deputy Chairman-HSBC Bank Middle East), and Mr Saleh Al Kowary (Chief Executive Officer- HSBC Bank Middle East, Bahrain).
Speaking on behalf of Al Gosaibi Co., Sh Sulaiman Hamad Al Gosaibi underlined the significance of the rewarding 50-year long relationship between the two institutions and described it as a close and strong bond between a reputed bank and a deep-rooted family.
Mr David Hodgkinson, in his speech, emphasized the uniqueness of the relationship and stressed the importance of further strengthening the distinguished ties.
May 29 ,2002
SABB Opens Al Amanah Islamic Branch In Rabwa
The Saudi British Bank (SABB) has officially opened the Al Amanah Islamic Branch in Rabwa, in a ceremony attended by SABB Chairman Sh. Abdullah Al Hugail, Managing Director Mr David Hodgkinson and Deputy Managing Director, Financial Services Mr Sulaiman Al Hamdan and the Bank’s Shariah Committee members: Sh. Abdullah Bin Manea, Member Board of Senior Scholars Committee for Fatwa, Sh. Dr Abdullah Al Mutlaq, Professor Comparative Fiqh, Higher Judicature Institute – Imam Mohammed Bin Saud University, and Sh. Dr. Mohammed Al Gari Bin Eid, Head of Islamic Economic Center – King Abdul Aziz University.
Sh. Al Hugail, speaking on the occasion said: “The opening of the Rabwa Islamic banking branch is part of the Bank’s plan to convert four of its existing branches to Islamic banking branches. The Islamic banking services now available at Rabwa branch will be offered from Medinah and Buraidah branches next month and in Makkah from September.”
He added that the Rabwa branch had delivered encouraging results during the assessment period which began from April 2001. In addition to Rabwa branch SABB offers Al Amanah Islamic banking services at 17 outlets in other branches consisting of six in Riyadh, two in Qassim, six in the Western Province and three in the Eastern Province.
The Al Amanah Islamic banking products include Al Amanah Current Account, Amanah VISA, Murabaha loan, Home Lease, SAR & USD Funds and the Secure Equity Fund which was closed oversubscribed this month.
Meanwhile, the members of the SABB Shariah Committee lauded the earnest efforts of the bank to open Islamic branches and have called for more such branches.
May 25, 2002
The Saudi British Bank First Quarter 2002 Results
Highlights
Comment by David Hodgkinson, Managing Director
The Saudi British Bank (SABB) recorded a net profit of SAR235.0 million (US$62.7 million) for the quarter ended 31 March 2002. This represents an increase of 20.1 per cent over the same period in 2001. Operating income (excluding gains on investments) of SAR428.1 million (US$114.2 million) increased by 8.1 per cent compared to the quarter ended 31 March 2001, and was broad based with satisfactory contributions from all business segments. Earnings per share increased to SAR5.87 (US$1.57) compared to SAR4.89 (US$1.30) for the first quarter of 2001.
Customer deposits increased to SAR32.1 billion (US$8.6 billion) at 31 March 2002, up 6.3 per cent on last year. Loans and advances to customers, at SAR17.3 billion (US$4.6 billion), were 6.1 per cent higher.
We are proud that The Consulting Center for Finance and Investment named us the best performing bank in the field of mutual funds, based on their survey of the market. In the survey, we achieved the highest number of top rankings for various categories of mutual funds offered by Saudi banks.
While current economic conditions require strict cost discipline, we continue to invest in upgrading our customer service and delivery systems in line with the increased customer focus of our new strategic plan.
We thank our customers for their steadfast support and our staff for their dedicated efforts during the period
Media enquiries to Abdulaziz Al-Manie [966] (1) 405-0677 Ext,4310
or at abdulazizaalmaniea@sabb.com
Click here for Year 2002 First Quarter Financial Statements
April 9, 2002
SABB Releases 2001 Annual Report
The 24th Annual Report of The Saudi British Bank (SABB) outlining the Bank’s performance and growth in the year 2001 has been released by the Public Affairs Department.
Extensive efforts have gone in to make the Report comprehensive and indicative of the strides taken by SABB in its 24th year of operations. The Report contains both Arabic and English versions and comprises of the chairman’s statement, director’s report, financial statements and auditor’s report.
Earlier SABB had reported a net profit of SAR 830 million for the year ending 31 December 2001, a 11.7 % increase over SAR 743 million registered the previous year.
March 11, 2002
SABB Holds Annual Party
The Saudi British Bank (SABB) recently held the Annual Party for its Head Office and Central Province staff at the Riyadh Inter-Continental Hotel, a function which was attended by the Managing Director Mr David Hodgkinson and other SABB Executives from the region.
Mr Abdulaziz Al Manie, Senior Manager Public Affairs, said: “The SABB Annual Party celebrations are in appreciation of the role its employees play in furthering the Bank’s interests through their professionalism and dedication to customer needs and interests. These occasions provide employees a relaxed atmosphere to interact with each other thereby building relationships and cooperation between them. The function is also an excellent venue to honour staff members with long-service awards.”
In addition to the awards presentation, the party schedule included an address by Mr Hodgkinson, distribution of a number of prizes and entertainment.
February 18,2002
Al Hamdan appointed SABB Deputy MD Financial Services
As part of a strategy to maintain its presence at the forefront of banking in Saudi Arabia, and developing and supporting the Saudi economy even while boosting Saudisation, The Saudi British Bank (SABB) has approved a new strategic plan for the coming three years (2002-4).
Under the new strategy, a number of new senior positions have been created, one of which is Deputy Managing Director Financial Services to which Mr Sulaiman Al Hamdan has been appointed. Mr Adel Al Nasser, meanwhile, has been appointed General Manager Credit & Risk.
Sheikh Abdullah Mohamed Al Hugail, SABB Chairman, said: “The Bank’s new strategy which enhances its Saudisation efforts is part of its policy as the pioneer in Saudisation of senior postions.”
The Bank’s new organisational structure has been adopted to ensure continuation of its rapid and solid growth in the Kingdom’s banking sector. The new structure will also increase opportunities for Saudi staff to take over leading positions in the Bank.
Saudis now represent 75% of SABB’s staff complement. The number of ladies, all of whom are Saudi, has also increased to 220 representing 11% of the SABB work force.
February 9, 2002
SABB Launches Business MasterCard
As part of its on-going efforts to introduce top of the line banking services, The Saudi British Bank (SABB) has launched the SABB Business MasterCard Card for businesses, which would enable them to manage their cash flow and also provide the convenience of worldwide acceptance and cash access.
Mr Sulaiman Al Hamdan, General Manager Personal Banking Services, SABB, speaking on the SABB Business Card said: ‘The launch of this service indicates the Bank’s determination to pursue its policy of development of services and products to satisfy all the needs and requirements of its customers.”
Businesses utilising the SABB Business Card can nominate the staff authorised to use it and their individual credit limit, enabling them to pay for their business trips, hotels and their daily expenses with the Card. Mr Hamdan added, “the transactions of all the authorised staff of a business would be provided in one consolidated statement of account every month, thus facilitating better information, less paperwork and more control.”
January 30, 2002
SABB 2001 Annual Results
Highlights
Commentary
The Saudi British Bank (SABB) recorded a net profit of SAR830 million (US$221 million) for the year ended 31 December 2001. This represents an increase of 11.7 per cent over the SAR743 million (US$198 million) earned in 2000.
Customer deposits increased to SAR31.5 billion (US$8.4 billion) at 31 December 2001 from SAR28.4 billion (US$7.6 billion) at 31 December 2000, despite the continuing decline in interest rates.
Loans and advances to customers increased to SAR16.0 billion (US$4.2 billion) at 31 December 2001 from SAR15.9 billion (US$4.2 billion) at 31 December 2000. There has been a slow pick up in demand for commercial credit. The bank’s personal lending portfolio recorded steady growth.
The bank continued to deploy available liquidity in a diversified investment portfolio during 2001. As a result, the total value of the bank’s investment portfolio increased to SAR21.8 billion (US$5.8 billion) at 31 December 2001 from SAR18.4 billion (US$4.9 billion) at 31 December 2000.
The basis of measurement and recognition of financial instruments has changed from the year 2000 as a result of the first implementation of International Accounting Standard – 39 in 2001.
David Hodgkinson, managing director, said: “Our performance for 2001 was in line with our expectations. Despite lower interest rates, an increase in operating revenues was recorded. The increase in net fees and commission was encouraging and ‘funds under management’ increased by 87 per cent.
“New products launched during the year were well received. Our Al-Amanah range of products allows customers to opt for their preferred method of investment or financing. In particular, the Al-Amanah Home Ownership scheme launched during the year caters to the growing customer demand for housing in Saudi Arabia.
“We aim to provide our customers with improved services through a broad range of delivery channels via traditional and electronic means, and market research indicates that this is proving popular with customers.
“The Board has recommended a final net dividend of SAR9 per share. The total net dividend for 2001 will amount to SAR14 per share as an interim net dividend of SAR5 was paid in August 2001. The net dividend is payable on the bank’s enhanced capital which increased by 25 per cent in 2001 after the issue of bonus shares in the ratio 1:4. As a result, the total gross dividend will increase by 34 per cent over 2000.
“We thank our customers for their steadfast support and our staff for their dedicated efforts during the year.”
Media enquiries to Abdulaziz Al-Manie [966] (1) 405-0677 Ext,4310
or at abdulazizalmaniea@sabb.com
Click here for Year 2001 Financial Statements
January 16,2002
