Banque Saudi Fransi (1050) Q1 2026 earnings summary

Executive summary

• Net income for Q1 2026 grew 3.2% year-over-year to SAR 1,381 million, driven by higher operating income, improved cost of risk, and lower impairments.

• Loans and advances increased 6% year-over-year, with commercial and consumer portfolios, especially mortgages and auto loans, as key drivers.

• Customer deposits rose 5% year-over-year, with a notable improvement in non-interest-bearing deposit mix.

• The bank maintained strong capital and liquidity positions, with a CAR of 21.0%, Tier 1 ratio of 18.8%, and LCR at 186%.

• Strategy 2030 targets sustainable ROE above 15% and 8-10% market share of net income by 2030, with digital and AI transformation underway.

Financial highlights

• Net interest income grew 5% year-over-year to SAR 2,217 million, while non-interest income declined 5% due to lower fees and commissions.

• Operating income rose 3% year-over-year to SAR 2,708 million; operating expenses increased 6% year-over-year, mainly from higher employee costs and depreciation.

• Cost-to-income ratio at 34.1%, above the sub-33% target, but expected to trend lower as operating leverage builds.

• Cost of risk improved to 48 bps from 51 bps a year ago, with impairment charges down 12% year-over-year.

• Total assets reached SAR 324.8 billion, up 7% year-over-year.

Outlook and guidance

• Full-year 2026 guidance reaffirmed: high single-digit loan growth, NIM around 3%, cost of risk 45-55 bps, cost-to-income below 33%, and ROE of 12-13%.

• CET1 ratio expected to remain above 15%; positive outlook supported by sustained loan growth and efficiency gains.

• The bank continues to monitor geopolitical risks, with ongoing stress-testing and scenario analysis for credit and liquidity impacts.