aljazira bank (1020) Q1 2026 earnings summary

Executive summary

• Net income rose 12% YoY in Q1 2026 to SAR 405 million, driven by improved net margin, disciplined cost management, and expanding business volumes.

• Total operating income increased 7% YoY to SAR 1,152 million, with fee and other income comprising 29% of the total.

• Balance sheet expanded by 13% YoY to SAR 173.1 billion, supported by growth in commercial and retail financing and a 7% increase in customer deposits.

• Strategic initiatives advanced across retail, corporate, treasury, and technology segments, with digital transformation, AI integration, and a new brand identity.

• The group operates 73 branches and 24 remittance centers in Saudi Arabia, offering a full range of Shari'ah-compliant banking products.

Financial highlights

• Net income reached SAR 405 million in Q1 2026, up 12% YoY and 12% YTD.

• Net margin improved to 2.10%, up 9 bps YoY and sequentially.

• Total assets grew to SAR 173.1 billion (+13% YoY), with customer deposits at SAR 124 billion (+13% YoY, +7% YTD).

• Net financing reached SAR 114.3 billion, up 14% YoY and 3% YTD.

• Fee and other income contributed 29% of total revenues.

• Cost of risk declined to 0.20%, down 19 bps YoY and 34 bps YTD, reflecting stable asset quality.

• Basic and diluted EPS was SAR 0.24, compared to SAR 0.28 in Q1 2025.

Outlook and guidance

• FY 2026 guidance targets high single-digit financing growth and net margin between 2.05% and 2.10%.

• Cost to income ratio expected to remain below 52%.

• ROAE after zakat and tax projected above 7.75%.

• Management reaffirmed full-year guidance, emphasizing continued optimization of funding, asset mix, and pursuit of profitable growth.

• Management revised ECL scenario weightings to reflect a more cautious outlook due to regional geopolitical uncertainties, but the impact was assessed as immaterial for Q1 2026.