Banque Saudi Fransi (1050) Q2 2025 earnings summary

Executive summary

• Net income rose 20% year-over-year to SAR 2,741 million in 1H 2025, driven by strong operating income, improved cost of risk, and disciplined execution.

• Operating income increased 14% year-over-year to SAR 5,317 million, with net interest income up 12% and non-interest income up 23%.

• Total assets reached SAR 301.5 billion, up 4% year-over-year, supported by 6% loan growth and a 13% increase in the investment portfolio.

• Advanced digital transformation and technology initiatives, including new mobile app, core banking upgrades, and corporate portal.

• Progressed on BSF 2030 Strategy, emphasizing core business strength and future growth opportunities.

Financial highlights

• Loans and advances grew 6% year-over-year to SAR 210 billion, with healthy origination in both corporate and retail; investments increased 13% year-over-year.

• Deposits declined 7% year-over-year to SAR 182.69 billion, mainly due to lower corporate and interest-bearing balances.

• Cost-to-income ratio improved by 113bps to 32.7% as revenue growth outpaced cost inflation.

• Cost of risk declined by 10bps year-over-year to 0.50%, with impairment charges down 6%.

• EPS rose 17% year-over-year to SAR 1.02.

Outlook and guidance

• Loan growth guidance revised down from low double digits to high single digits for 2025, reflecting modest first half expansion and expected second half pickup.

• Net interest margin expected to remain within 3.05%-3.15% guidance band.

• Cost of risk expected to remain stable at 50-60bps, trending toward lower end.

• Cost-to-income ratio aligned with target of below 33%.

• Return on equity tracking within 11%-12% target range.