Banking & Finance

Al Rajhi Bank reports 34% rise in quarterly profit

April 23, 2025, 1:46 PM

Customers use Al Rajhi cash dispensers at a branch in Mecca. The bank's total assets have topped SAR1 trillion — Al Rajhi cash dispensers at a branch in Mecca. The bank's assets have topped SAR1 trillion

Lender’s net profit hit $1.5bn in Q1
Al Rajhi is world’s biggest Islamic bank
Profit up 3% at Kuwait Finance House

Al Rajhi Bank, the world’s largest Islamic bank by capital, has reported a 34 percent increase in net profit for the first quarter of 2025, to SAR5.9 billion ($1.5 billion).

The Saudi bank’s total assets have risen by 22 percent to SAR1.02 trillion, marking the first time Al Rajhi has surpassed the trillion-riyal mark.

Its share price closed 0.41 percent up on Tuesday at SAR98 per share. The price has risen by nearly a quarter in the past 12 months.

Higher net financing and investment income, banking services fees and foreign exchange gains were the primary drivers of Al Rajhi’s 27.3 percent increase in operating income.

Operating expenses including impairment charges for financing increased by 12.9 percent. This was in part down to rises in salaries and employee benefits.

Al Rajhi’s provision for expected credit losses rose by 24.7 percent.

Kuwait Finance House, which is the second-largest Islamic bank in the world, also announced a profit bump on Wednesday.

Its net profit rose 3.2 percent year on year to KD168.1 million ($549 million) in the first quarter. Total operating income for the quarter was up 16 percent to KD454.9 million.

On Tuesday, three of Saudi Arabia’s five biggest banks by assets – Saudi National Bank, Riyad Bank and Banque Saudi Fransi – reported record first-quarter profits after generating more income from loans and reducing operating costs.

However, banking analysts told AGBI last week that President Donald Trump’s tariffs would trouble lenders in the GCC, despite the bloc’s meagre non-oil exports to the United States.

“A significant reduction in oil prices could impinge on [Gulf] government spending and economic sentiment and lead to an increase in non-performing loans,” an S&P Global Ratings report has warned.

“The most imminent threats are market volatility and investor risk aversion.”