Saudi Awwal Bank (1060) Q2 2025 earnings summary

Executive summary

• Net income for 1H25 rose 5% year-over-year to SAR 4.3 billion, driven by 6% revenue growth to SAR 7.3 billion and strong loan growth of 17% year-over-year and 9% year-to-date.

• Total assets grew to SAR 432.4 billion as of 30 June 2025, compared to SAR 382.3 billion a year earlier.

• Achieved sequential records in both revenue and net special commission income (NSCI), with cost efficiency improving to 29.2%.

• Asset quality remains robust, with a low cost-of-risk and NPL ratio at 1.4%.

• Return on tangible equity (ROTE) after AT1 coupon payment was 15.5% for 1H25, aligning with medium-term objectives.

Financial highlights

• Net income for 1H25 reached SAR 4.3 billion, up 5% YoY; revenue was SAR 7.3 billion, up 6% YoY; quarterly revenue at SAR 3.7 billion, up 3% QoQ.

• Gross loans grew 17% YoY to SAR 289.3 billion; customer deposits up 11% YTD to SAR 297.0 billion.

• Pre-provision profits increased 8% YoY to SAR 5.2 billion.

• Cost efficiency ratio improved to 29.2% in 1H25 from 30.6% in 1H24.

• CET1 capital ratio at 14.8%, total capital adequacy ratio at 19.34%.

Outlook and guidance

• On track to deliver medium-term targets, including mid-teens loan growth and ROTE of 15-16%.

• NIM expected to stabilize in 2H25, with continued focus on funding optimization.

• Cost of risk guidance maintained at 25-35bps; annualized cost-of-risk for 1H25 was 26bps.

• The bank completed a SAR 2 billion Additional Tier 1 Sukuk issuance in July 2025, enhancing capital structure.

• The bank opted to redeem its SAR 5 billion Tier II Sukuk in July 2025.