NCB’s Q2 figures match estimates, Riyad Cap says

The National Commercial Bank (NCB) reported a net income of SAR 2.58 billion (+7 percent YoY, -14 percent QoQ) in Q2 2018, in-line with Riyad Capital forecasts of SAR 2.48 billion and market consensus of SAR 2.52 billion.

The bank managed to grow its loans and deposits aggressively during the quarter, adding SAR 13.3 billion and SAR 8.7 billion respectively, causing LDR to reach 81 percent.

“We maintain our Neutral recommendation but raise our target price to SAR 48.00 from SAR 41.50”, Riyad Capital said in a recent report.

The overall sector added SAR 20.7 billion in loans and SAR 13.5 billion in deposits.

“We can perceive accordingly that NCB was a major contributor to those rises,” the brokerage added.

Provisions accrued to SAR 341 million in Q2 2018, close to the estimated SAR 350 million. It came lower than last year’s level of SAR 478 million, but significantly higher than Q1 2018 level, where the bank booked negative provisions amounting to SAR 8 million due to a major one-off recovery of debts previously written-off.