Banque Saudi Fransi (1050) investor relations material

Executive summary

• Net income for H1 2026 grew 5% year-on-year to SAR 2.868 billion, driven by a 6% rise in net interest income and supported by robust loan and deposit growth, despite higher operating expenses.

• Strategy 2030 execution is underway, with 21 of 24 programs active and early impacts seen in wholesale, retail, and private banking.

• Asset quality remained strong with a stable NPL ratio at 0.97% and coverage at 159.3%.

• Capital and liquidity levels remained robust, with Tier 1 ratio at 18.8% and LCR at 169%.

• Total assets reached SAR 328 billion, up 9% year-on-year.

Financial highlights

• Operating income rose 5% year-on-year to SAR 5.56 billion, driven by a 6% increase in net interest income; non-interest income remained stable.

• Loans and advances rose 7% year-on-year to SAR 224.2 billion; customer deposits increased 12% to SAR 204.6 billion.

• Net interest margin declined 7bps year-on-year to 3.04%, but improved 4bps sequentially.

• Cost-to-income ratio at 33.2% for H1, with operating expenses up 6% year-on-year.

• Cost of risk improved by 6bps year-on-year to 0.44%.

Outlook and guidance

• Full-year guidance maintained: high single-digit loan growth, NIM around 3%, cost-to-income ratio below 33%, and ROE between 12-13%.

• Cost of risk guidance narrowed to 45-50bps, reflecting improved credit quality.

• Expect stronger operating leverage and fee income contribution in H2 2026.

• Economic outlook for Saudi Arabia remains positive, with GDP growth forecast at 1.7% for 2026 and a rebound to 5.5% in 2027.

• IFRS 18 implementation is underway, with expected changes to financial statement presentation and disclosures by 2027.