Riyad Bank, Saudi Arabia's third largest bank by market value, posted a 28.4 percent fall in third-quarter net profit on Tuesday, blaming recent global fluctuations for the decline.

It was the first quarterly drop in the bank's profit in at least five quarters.

The bank made SR2.11 billion ($562.7 million) in the nine months to September 30 against SR2.22 billion a year earlier, it said in a statement posted on the bourse's website.

Based on Reuters calculations and previous financial statements, Riyad made a net profit of SR513 million ($136.8 million) in the three months to September 30 versus 716 million riyals in the same period of 2007.

'The slight decline in the bank's revenue and profit in the nine months ending Sept. 30, 2008 is due to a drop of 10.7 percent in the valuation at that period of the bank's commercial portfolio which was worth 3.73 billion riyals as in September, 2009,' it said in the statement.

The decline in the value of the commercial portfolio was the indirect result of 'fluctuations that affected global markets recently'.

The bank dismissed any link between this decline and exposure to toxic mortgage products. 'There is no impact whatsoever of the mortgage crisis on the bank's financial situation', it said.

Analysts forecast of the bank's third-quarter earnings ranged from SR773 million to SR981.2 million, according to a Reuters survey last month.

Contrary to stock market regulations, Riyad bank did not give performance indicators for the third quarter alone.

Operating income was SR3.77 billion in the nine months to September, up from SR3.83 billion it has reported for the same period a year earlier.

Riyad Bank raised $3.5 billion from a giant rights issue in May to hike its capital by 140 percent and replenish reserves, at a time when there was lesser concern over the liquidity squeeze that is now hitting markets globally and in the region. - Reuters