Saudi banks’ aggregate profit reaches $2.2bn.

Saudi banks posted strong financial results in January, with aggregate profits rising 16 percent year on year to SR8.14 billion ($2.17 billion), according to newly released data. 

Figures from the Saudi Central Bank, also known as SAMA, representing pre-zakat and pre-tax earnings, highlight the sector’s resilience and growing profitability. 

The surge comes as total bank loans in Saudi Arabia exceeded SR3 trillion for the first time, marking a 14.66 percent annual increase — the fastest pace since October 2022. 

A key driver of this growth has been increased business financing, particularly in real estate, manufacturing, and trade. As lending to these sectors expands, banks benefit from higher interest income, reinforcing their financial performance and their role in supporting economic diversification under Vision 2030.  

Saudi banks closed 2024 with record-high cumulative profits of SR89.1 billion, with December marking the highest monthly earnings. 

The sector has also benefited from government stimulus efforts aimed at supporting businesses, enhancing credit access, and driving infrastructure development. To sustain growth, Saudi banks have tapped into the bond market, securing additional capital for lending and investments, further strengthening their financial positions amid economic fluctuations. 

S&P Global also sees credit growth as a key driver of bank profitability, with return on assets projected to stabilize between 2.1 and 2.2 percent, in line with the 2024 estimate. 

This, along with a strong provisioning cushion, will help mitigate potential credit losses, which are expected to range between 0.50 and 0.60 percent of total loans over the next 12-24 months. 

Source: ARABNEWS