Bank Albilad has reported a reduction in its shareholders’ equity by SAR 80.6 million as a result of the application of IFRS 9 standard.
Saudi-based banks applied the IFRS 9 accounting standard as of January 1, 2018, that requires banks to set aside provisions for credit impairment on anticipation of customer default, not when actual default happens.
The standard has a direct impact on banks' solvency positions and shareholders' equity.
|
Impact of IFRS (9) (SAR mln) |
||
|
Period |
Retained earnings |
Other reserves |
|
Closing balance (Dec. 31,2017) |
530.8 |
47.4 |
|
Expected credit losses |
(71.3) |
0.0 |
|
Reclassifications according to new standards |
45.0 |
(54.3) |
|
Opening balance (Jan. 1, 2018) |
504.5 |
(6.9) |
The table below tracks the change in shareholders' equity following the enactment of the standard:
|
Impact on Shareholders Equity* (SAR mln) |
||
|
Period |
Before adjustment |
After adjustment |
|
Capital |
6.00 |
6.00 |
|
Reserves |
1.59 |
1.51 |
|
Shareholders’ equity |
7.59 |
7.51 |
* Opening balance as of Jan. 1, 2018
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