A monumental surge in borrowing across Saudi Arabia has propelled the kingdom’s leading financial institutions to unprecedented heights, with two of the largest banks reporting record-breaking profits for the 2025 fiscal year. The recently released financial results for Saudi National Bank (SNB) and Alrajhi Bank paint a vivid picture of a robust and rapidly expanding lending sector, directly fueling the nation’s ambitious economic transformation. This remarkable growth, underscored by a sharp rise in both corporate and retail loans, reflects a dynamic period of investment and development within the Saudi economy. The substantial increase in lending activity is not merely a cyclical upswing but a foundational component of the country’s strategic push to diversify and modernize, with the banking sector serving as a primary engine for this national endeavor. The impressive financial performance of these key players signals strong confidence in the economic outlook and the viability of major ongoing development projects.
A Closer Look at the Financial Surge
The figures released on January 27 provide a clear measure of the sector’s explosive growth. SNB, the country’s largest bank by total assets, reported a remarkable 25% increase in comprehensive income for the 2025 fiscal year, reaching SAR26.8 billion, which translates to approximately $7.2 billion. In a parallel display of financial strength, Alrajhi, recognized as the world’s largest Islamic bank, announced an even more significant 32% year-on-year profit increase, matching SNB’s impressive SAR26.8 billion figure. Both institutions attributed this substantial profitability primarily to higher fees generated from an expanded portfolio of banking services. This financial upswing is also reflected in the growth of their asset bases. SNB’s assets expanded by 9% to reach a staggering SAR1.2 trillion, while Alrajhi’s assets grew by 7%, crossing the SAR1 trillion threshold. This trend is a clear indicator of a broader expansion within the kingdom’s financial industry, directly powered by the significant capital requirements of the transformative Vision 2030 projects, which have more than doubled the profits at both banks since 2020.
Sustaining Momentum Amid Shifting Tides
Expert analysis from S&P Global suggested a continued trajectory of strong lending activity for the banking sector. The ratings agency’s forecast indicated that retail lending was projected to rise to $20 billion, while corporate loans were expected to reach a substantial range of between $65 billion and $75 billion in 2026. While the outlook for overall bank profitability remained strong, analysts did anticipate a potential for a slight moderation. This expected dip was attributed to the possibility of lower interest rates, which could put pressure on margins. However, this pressure was expected to be significantly mitigated by the sustained momentum in lending growth, which would continue to generate revenue and support bottom lines. To ensure the availability of capital needed to fuel this ongoing expansion and maintain their growth trajectory, it was widely anticipated that Saudi banks would maintain their strategy of borrowing from international markets, tapping into global capital to support domestic development and secure their financial standing.
