Samba’s higher provisions hurt profits in Q2 2019: Riyad Capital

06/08/2019 Argaam

 

Samba Financial Group’s Q2 2019 net income of SAR 935 million came below market consensus of SAR 1.4 billion and Riyad Capital’s estimates of SAR 1.5 billion.


The brokerage firm said that operational costs spiked for the second quarter in a row by 67 percent YoY and 15 percent QoQ, its highest quarterly level ever, respectively to reach SAR 1.1 billion.

 

“This is mainly due to higher provisions, which we estimated to be around SAR 450 million,” it said.

 

The research firm maintained its “Neutral” recommendation towards the share without changing the target price of SAR 34 per share, awaiting more clarity about the sustainability of high provisions.

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