aljazira bank (1020) Q2 2025 earnings summary

Executive summary

• Net income for 1H 2025 reached SAR 743.1 million, up 20% year-over-year, with 2Q 2025 net income at SAR 382 million, reflecting strong growth across business lines and improved revenue mix.

• Total assets grew 14% YoY to SAR 157.6 billion as of 30 June 2025, with customer deposits up 16% YoY to SAR 114.2 billion, demonstrating robust franchise strength.

• Share capital increased to SAR 12.8 billion following a bonus share issue in Q2 2025.

• Transformation agenda advanced with digital onboarding, AI-driven efficiencies, and digital penetration reaching 82%.

Financial highlights

• Total operating income for H1 2025 was SAR 2.18 billion, up 22% YoY, driven by 21% growth in net financing and investment income and 23% increase in fee and other income.

• Operating expenses increased 14% YoY due to higher G&A and employee costs, but cost-to-income ratio improved to 52.3%.

• Net impairment charge for financing and other financial assets rose 109% YoY to SAR 200 million, mainly from the commercial portfolio.

• EPS for H1 2025 was SAR 0.50, up from SAR 0.41 in H1 2024 (restated for bonus shares).

• ROAE after zakat at 8.19%, ROAA at 1.09%, and net margin increased by 14bps YoY to 2.17%.

Outlook and guidance

• FY25 guidance unchanged: financing growth expected in the lower teens, net margin to expand by 5-10bps, cost of risk to remain between 0.35-0.40%, and cost-to-income ratio targeted below 55%.

• Management expects continued growth in financing and deposits, supported by a stable economic environment and Vision 2030 investments.