Saudi Banks’ Profits Hit Record High, Loans Surge
Saudi banks achieved a record profit of $2.1 billion in July, a 23% increase from the previous year. From January to July, total profits rose to $13.4 billion, marking a 13% annual growth.
Deposits grew by 8% to $704 billion, with term deposits surging 20% to $247.4 billion. Demand accounts, comprising 53% of total deposits, increased by 5% to $373 billion.
Total bank credit expanded by 12% in July, reaching $744.4 billion. The loans-to-deposits ratio, a key liquidity metric, climbed to 80.73% from 78.84% a year earlier.
The growth of Saudi Arabia’s banking sector is driven by favorable economic conditions, high oil prices, and government spending. These factors support the Kingdom’s ambitious projects and Vision 2030 strategy, contributing to robust non-oil GDP growth.
Fintech advancements are also reshaping the banking landscape. SAMA’s regulatory efforts, including the open banking framework and support for fintech companies, are fostering innovation and improving financial inclusion.
High interest rates have boosted loan profits, though competition among banks for borrowers has intensified. McKinsey’s research indicates that banks focusing on tech-savvy consumers and positive customer experiences see better financial performance.
GCC banks are digitizing customer journeys, transforming services like personal loans and credit cards. Advanced technologies, including AI, are enhancing customer self-service and operational efficiency, further improving satisfaction.