Saudi lenders’ 2Q earnings growth spans flat to 14%

Saudi lenders rolled out their 2Q results. Al Rajhi led the pack with 14% net income growth on stronger financing income. Aljazira and SNB also posted healthy earnings gains as income growth outpaced costs. Elsewhere, provisioning told the story. Alinma’s earnings were held back by higher expected credit-loss charges, while SAB’s bottom line got a lift from a near-total collapse in provisions, masking weaker operating income.

SNB keeps the momentum going

Saudi National Bank (SNB) posted a 7.6% y-o-y increase in net income to SAR 6.6 bn in 2Q 2026 as broad-based income gains fed through to the bottom line, it said in a Tadawul filing. Total financing income inched up 1.3% y-o-y to SAR 11.7 bn, and total investment income grew 2.7% to SAR 3.7 bn.

What lifted the books: Operating income climbed 11.3% y-o-y, running well ahead of the modest gross-income growth. The lift came from higher net special commission income, a 34% jump in investment gains, and stronger exchange income, with costs holding nearly flat.

The half tracked the quarter. Net income rose 7.2% y-o-y to SAR 13 bn, driven by financing income of SAR 23.1 bn (up 2.8%) and investment income of SAR 7.1 bn (up 0.9%). Earnings were lifted by the same drivers seen in the second quarter plus a 1.5% cut in operating expenses over the six months.

Financing income lifts Al Rajhi’s bottom line

Al Rajhi Bank reported a 14% y-o-y increase in net income to SAR 7 bn in 2Q, it said in a Tadawul filing. Total financing income rose 7.6% y-o-y to SAR 12.1 bn, while investment income edged down 0.8% to SAR 2.4 bn.

What drove the quarter: Operating income rose 13.3% y-o-y on higher financing and investment income, banking fees, and exchange income, leaving plenty of room to absorb a 19.4% increase in operating expenses and a 46.8% y-o-y hike in provisions to SAR 881 mn.

1H told a similar story: Net income rose 14.2% y-o-y to SAR 13.8 bn in 1H 2026, underpinned by a 9.9% increase in financing income to SAR 24.4 bn. Investment income was broadly flat, easing 0.4% y-o-y to SAR 4.6 bn.

Lower provisions lift SAB’s bottom line

Saudi Awwal Bank’s (SAB) 9.6% y-o-y rise in net income to SAR 2.3 bn in 2Q rested largely on a near-total drop in provisions rather than operating strength, according to its Tadawul disclosure. Total financing income grew 4.4% y-o-y to SAR 4.5 bn, while total investment income fell 5.2% to SAR 1.1 bn.

What lifted the books: A sharp drop in expected credit loss charges — down 97.7% y-o-y to SAR 5 mn from SAR 216 mn — did most of the heavy lifting, alongside a lower tax bill boosted by a refund on government sukuk holdings. Operating income actually fell 1.6% as weaker exchange income, fee income, and FVOCI gains more than offset higher net special commission income.

1H tells a milder version of the same story. Net income rose 3.6% y-o-y to SAR 4.4 bn, with financing income up 3.9% to SAR 8.9 bn and investment income down 2.4% to SAR 2.3 bn — again leaning on a lower provision charge, though 1H operating income essentially flatlined.

Dividends: The bank will distribute SAR 2.1 bn in dividends for 1H 2026, equivalent to SAR 1 per share by Thursday, 13 August.

Alinma Bank’s provisions eat its upside

Alinma Bank’s net income edged up 1.4% y-o-y to SAR 1.6 bn in 2Q 2026 as a jump in provisions all but wiped out solid income growth, according to a Tadawul filing. The bank’s total financing income grew 7.7% y-o-y to SAR 3.95 bn, while total investment income rose 7.8% to SAR 635.1 mn, both on higher lending and investment volumes. Stronger FVSI income added to the total, though softer fee, exchange, and other operating income pulled the other way.

A bigger cushion, thinner bottom line: Provisions for expected credit losses jumped 42.2% y-o-y to SAR 400 mn, which Alinma ties to growth in the financing and investment portfolio. The charge more than doubled against the prior quarter — up 157% q-o-q — which is why net income barely moved despite top-line gains.

SOUND SMART- Provisions, or expected credit losses, are funds banks set aside for loans they may not recover. Under accounting rules, banks recognize these expected losses upfront rather than waiting for a default. Provisions can rise either because credit risk has increased or because the bank’s loan book has grown.

The half was stronger than the quarter. 1H net income rose 6.2% y-o-y to SAR 3.27 bn on financing income of SAR 7.76 bn (up 7.6%) and investment income of SAR 1.24 bn (up 7.3%) — the 2Q provision spike is what pulled the quarterly figure below the half-year pace.

Dividends: The bank will distribute SAR 746.3 mn in dividends for 2Q 2026, equivalent to SAR 0.25 per share by Monday, 17 August.

Aljazira grows despite higher expenses

Aljazira Bank saw its net income grow 15.9% y-o-y to SAR 442.8 mn in 2Q as earnings growth outpaced higher costs, according to its Tadawul disclosure. Total financing income grew 10.4% y-o-y to SAR 1.8 bn, while total investment income rose 28.9% to SAR 561 mn. Higher financing and investment income, FVSI gains, and dividend income outweighed weaker fee and exchange income, while rising staff costs and depreciation lifted expenses.

The pattern held over six months. Net income rose 14.1% y-o-y to SAR 847.9 mn in 1H 2026, supported by a 9.6% rise in financing income to SAR 3.5 bn and a 17.5% climb in investment income to SAR 1.1 bn.