Al-Ahli Bank, the largest Saudi bank by assets, saw its second-quarter net profit rise 7.6% year-on-year to a record SAR 6.6 billion, beating expectations, with improved margins despite a slowdown in lending and higher provisions.

According to the Financial Analysis Unit at Al-Eqtisadiah, the growth rate of net profit in the second quarter accelerated compared to the first quarter but remains less than half the growth rate in the same period last year.

Tue, 21 2026

A significant acceleration in Al-Ahli Bank's interest income, supported by investment income.

The growth in the bank's profits came alongside an acceleration in commission income, the main source of income for banks, at the highest pace in four years at 11.4%, mainly supported by income from investments of nearly 140%, in addition to a lesser impact from the growth of financing income of about 5%.

This slowdown in financing income coincided with the bank's net loans recording the lowest growth rate in seven years at 3.5% to about SAR 740 billion, representing a slight decline on a quarterly basis but lower than the same period last year by about 9 percentage points.

Margins from commission income improved to 51.3%, the highest in about three years, with interest costs declining for the first time in more than five years by 7%.

Tue, 21 2026

As for growth in operating profit, it came in lower than that of commission income, recording the slowest growth rate in seven quarters at 5.1%, mainly pressured by an increase in credit loss provisions to SAR 258 million compared to a reversal of provisions in the comparable and prior periods.

Net income grew mainly supported by accelerated growth in commission income, but its faster growth than operating profit was due to growth in non-operating non-interest items, including a 34% rise in total gains/income from investments, and a 3.3% increase in net foreign exchange income.

Tue, 27 2026

Deposits grew at a faster pace than loans for the second consecutive quarter.

The bank's loan-to-deposit ratio fell to 106% from 109% a year ago, with deposits growing faster than loans for the second straight quarter. The acceleration in the first quarter was the first of its kind in four years, as higher interest rates enticed customers to increase their interest-bearing deposits (time and savings), whose share of the bank's deposits rose to the highest level in about three years at 26%, raising their share of total deposits to 25.2%, the highest since the end of 2019.

The slowdown in the bank's loan growth can be explained by the retail segment, which recorded in the first quarter of this year the slowest growth rate in nine years at 1.4%.

Al-Ahli Bank announced a dividend of SAR 1.15 per share for the first half of this year, stable compared to the previous half, bringing total distributions over the last 12 months to SAR 2.3 per share, representing a competitive cash dividend yield in the stock market of 5.9%, clearly exceeding the market average yield of 3.5%.

Al-Ahli Bank's distributions over the last 12 months represent an increase of 15% over the previous period of SAR 2 per share, with continued improvement in the bank's profitability. The stock rose yesterday by 0.6% to SAR 38.8 after reporting results that exceeded expectations in the second quarter.

Financial Analysis Unit