SAMBA denies deposits hit by anti-US campaign

RIYADH, 28 May — The Saudi American Bank (SAMBA) yesterday denied any drop in the bank’s deposits as a result of “Saudi defiance of the US.”

Reacting to a report in Arab News on Sunday, Mike de Graffenried, managing director of SAMBA, said the bank’s “customer business continues to grow robustly, with non-interest bearing deposits having increased from both December 2001 and March 31, 2002. Its loan business grew significantly during the first quarter of 2002, as is clearly evident in its financial statement.”

The report said SAMBA deposits dropped nearly $600 million in the first quarter of this year, a striking departure from each of last year’s four quarters, when deposits increased by SR3.6 billion over the full year.

Explaining the reasons for the perceived drop in customer deposits, de Graffenried said SAMBA, having begun the closure of its Geneva subsidiary in the first quarter, changed the way it dealt with fiduciary deposits.

“These deposits are now placed with international banks. Previously, these deposits had appeared on SAMBA’s own books. This is a technical change, which represents no change in SAMBA’s business or relationship with its customers. In the abbreviated quarterly reporting as of March 31, there was no opportunity to provide this technical explanation.”

The anti-US protests are aimed at the US administration over its ban on American banks accepting transactions from a number of Palestinian and Islamic charities that Washington has identified as having connections with terrorism.

Samba is the kingdom’s second largest bank in terms of assets and is 22.83 percent owned by Citibank of the US.

De Graffenried said SAMBA is a Saudi bank with 73.6 percent owned by Saudi shareholders. The bank has won the Global Finance magazine’s distinction for being the best Saudi bank for the last four consecutive years. — Javid Hassan