RIYADH: Saudi Arabia’s top 10 banks have posted solid profit growth in the second quarter of 2022, driven by high crude prices and rising interest rates.
The total quarterly profit of the 10 banks rose 2.7 percent in the second quarter of this year. They saw a 3.8 percent increase in operational income, according to consulting firm Alvarez and Marsal’s latest Saudi Arabia Banking Pulse.
The country’s 10 largest listed banks analyzed by A&M are Saudi National Bank, Al Rajhi Bank, Riyad Bank, Saudi British Bank, Banque Saudi Fransi, Arab National Bank, Alinma Bank, Bank Albilad, Saudi Investment Bank and Bank Aljazira.
“The rising oil output supported by the high crude price along with the benchmark interest rate increase indicate a positive outlook for KSA’s banking sector,” Managing Director and Head of Middle East financial services at A&M, Asad Ahmed, commented.
“We expect the Saudi Central Bank to continue matching the US Federal Reserve rate hike policies which will assist banking sector profitability,” he added.
The overall operating efficiency of banks improved during the second quarter of 2022 as they continued to rationalize their branches and increased their use of digital technology.
The profitability ratios in the second quarter, such as return on equity and return on assets, increased by 13.5 percent and 1.9 percent, respectively.
The total loans and advances increased at a higher rate of 4.2 percent quarter-over-quarter, while deposits increased 3.2 percent.