In a recently released analysis, Aljazira Capital, a prominent research firm, has projected a 6.7% surge in the profits of three key Saudi banks listed on the Tadawul stock exchange for the second quarter of 2024. The anticipated growth is attributed to widening profit margins and an overall increase in asset values.
A closer look at the report reveals expectations for Al Rajhi Bank, Alinma Bank, and Bank AlBilad to collectively amass profits nearing 6.41 billion Saudi Riyals. Al Rajhi Bank, specifically, is predicted to see a 6.4% rise in its quarterly earnings, reaching 4.41 billion Riyals, influenced by a 1.1% growth in deposits from the same quarter of the previous year and a 6-basis-point jump in net interest margin.
Alinma Bank is also set to experience a significant profit hike of 9.1%, which translates to 1.336 billion Riyals. Bank AlBilad is expected to outshine its counterparts with a robust 13% increase in net profits, hitting 662 million Riyals, thanks to a more substantial financial position, an 8.1% rise in total deposits compared to the same quarter last year, and improvements in net interest margin alongside reduced provisions for doubtful debts.
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According to Aljazira’s report, loan growth for the banks under its coverage is anticipated to be at 6.7% year-on-year for the quarter, with 0.4% growth over the previous quarter. Alinma Bank is forecasted to lead the pack with a 12.8% increase in loans. Al Rajhi Bank’s loans are expected to grow by 5.2%, with a 1.0% increase from the preceding quarter, buoyed by advancements in real estate financing—average issuance of new mortgage loans in April and May saw an 18.9% increase from the corresponding month of the previous year.
Deposit growth for the banks is also on the rise, with a 7.6% year-on-year increase and a 0.7% increment from the previous quarter predicted. Furthermore, the revenues of the three banks are projected to exceed 8.82 billion Riyals for Q2 of 2024.
