An Overview

The Kingdom being recognised as the world’s fastest growing economy by 8.7% in 2022 with a positive outlook for 2023 laid the stage for Al Rajhi Bank to continue delivering a strong performance across all business lines. Guided by its 2021-2023 Bank of the Future (BOTF) Strategy and its initiatives, Al Rajhi Bank recorded a 22% YoY growth across its balance sheet. Consumer spending continued its positive trend with an increase of 9.5% in 2022 on the back of improved economic activities across the Kingdom. The financing portfolio also grew at 26% for the year to reach SAR 568 Bn.

Mortgage recorded a growth of 30% YoY, and now represents close to 39% of our total financing portfolio and 51% of the Al Rajhi retail book. In addition, the successful implementation of our BOTF Strategy saw a 57% growth in our corporate book and an equally impressive 61% growth in our SME business, contributing to a significant 59% YoY growth of our non-retail book. We also delivered a solid net income growth of 16% YoY to reach SAR 17.2 Bn., driven by both a 9% increase in net yield income, and a non-yield income growth of 20%.

One of the key highlights for Al Rajhi Bank in 2022 was our successful diversification of funding sources, with our Treasury Group carrying out three major transactions during the year under review; a Tier 1 Sukuk was issued for the first time in Al Rajhi Bank’s history at a total value of SAR 6.5 Bn., the Bank also became the first Islamic Bank in the world to raise a Sharia-compliant, green syndicated loan of USD 1.2 Bn., and also went on to announce a Tier 1 Sukuk public issuance, the first of its kind in the market, raising the issue to SAR 10 Bn. to meet the demand of over 125,000 investors.

A detailed review of Al Rajhi Bank’s results of operations and financial position is given below:

Five-year summary of the Income Statement

Description 2022
SAR ‘000
SAR ‘000
SAR ‘000
SAR ‘000
SAR ‘000
Gross financing and
investment income
28,201,631 21,441,506 17,377,963 16,962,583 14,993,709
Return on customers’, banks’ and financial institutions’ time investments 6,028,944 1,049,570 464,946 534,860 506,724
Net financing and investment income 22,172,687 20,391,936 16,913,017 16,427,723 14,486,985
Fee from banking services, net 4,624,140 3,933,107 2,659,680 1,987,367 1,867,034
Exchange income, net 1,162,162 787,898 783,894 774,096 755,804
Other operating income, net 616,030 603,457 364,669 295,278 209,695
Total operating income 28,575,019 25,716,398 20,721,260 19,484,464 17,319,518
Salaries and employees’ related benefits 3,395,191 3,132,346 2,977,344 2,794,046 2,809,449
Rent and premises related expenses 0 0 0 314,567
Depreciation and amortization 1,330,119 1,141,932 1,118,148 1,059,582 603,136
Other general and administrative expenses 2,725,760 2,652,244 2,646,409 2,532,213 1,925,518
Operating expenses before credit impairment charge 7,451,070 6,926,522 6,741,901 6,385,841 5,652,670
Impairment charge for financing and other financial assets, net 2,001,259 2,345,086 2,165,740 1,772,265 1,530,946
Total operating expenses 9,452,329 9,271,608 8,907,641 8,158,106 7,183,616
Income for the year before Zakat 19,122,690 16,444,790 11,813,619 11,326,358 10,135,902
Zakat for the year (1,971,865) (1,698,579) (1,218,071) (1,167,831) (6,367,949)
Net income for the year 17,150,825 14,746,211 10,595,548 10,158,527 3,767,953


Revenue breakdown by subsidiaries 2022
SAR ‘000
Al Rajhi Capital Company – KSA 866,520
Management and Development for Human Resources Company – KSA 947,953
Al Rajhi Bank – Kuwait 88,892
Al Rajhi Bank – Jordan 147,927
Tuder Real Estate Company – KSA 187,952
Al Rajhi Corporation Limited – Malaysia 233,625
Emkan Finance Company – KSA 1,053,064
Tawtheeq Company – KSA 9,443
Al Rajhi Financial Markets Ltd
International Digital Solutions Co. (Neoleap) – KSA 346,766
Ejada System Limited Co. – KSA 248,805
Total 4,130,948

Total operating income

Al Rajhi delivered a strong growth in total operating income driven by both yield and non-yield income to reach SAR 28.6 Bn. for 2022, recording a growth of 11% YoY. Yield-based income for the year grew 9% to SAR 22.2 Bn., accounting for 78% of the Bank’s total operating income.

The continued focus on increasing our revenue mix resulted in the Bank’s non-yield income increasing to represent 22% of the Bank’s total operating income. Non-yield income growth was driven by a 18% fee income increase YoY; the positive migration to cashless payments coupled with an increase in consumer spending as well as an increase in market share (from acquired businesses) resulted in growing payment revenues during the year under review. A decent YoY growth in trade and cash management fee income from the steadily growing corporate business also contributed to the revenue mix. Exchange income has also shown a strong performance increasing by 48% YoY.

Operating income vs operating expenses

Operating expenses

The Bank’s operating expenses for the year amounted to SAR 7.5 Bn., an increase of 7.6% resulting from the 22% YoY growth of our overall balance sheet, and higher transaction volume compared to last year. The Bank continued to make strategic investments during the reporting period to execute and deliver ambitious KPIs of the BOTF Strategy.

However, the Bank recorded a 11% increase in operating income, resulting in a strong, 354-basis-point positive jaws, and a 86-basis-point cost-to-income improvement. This ensured Al Rajhi Bank recorded the leading cost-to-income ratio in the local market, standing at 26.1% for the period.

Impairment Charges

In line of the International Financial Reporting Standard 9 – Financial Instruments (IFRS 9) issued by the International Accounting Standards Board (IASB), Al Rajhi Bank updated the “expected credit loss” (ECL) framework for the recognition of impairment, taking into consideration current events and forecast information including the positive macro outlook for The Kingdom. This resulted in our net impairment charges for the period to decrease to SAR 2 Bn., almost a 15% drop YoY. These lower charges complemented by the growth of our financing portfolio resulted in our cost of risk decreasing from 0.60% in 2021 to 0.39% in 2022.


Having recorded SAR 17.2 Bn. in net income after Zakat for the year, Al Rajhi continued to maintain industry-leading returns, with a steady Return on Assets (ROA) at 2.46% and Return on Equity (ROE) at 22.68% in 2022. The Bank also recorded a 3.71% return on its risk-weighted assets (RORWA) at the end of the year.

Earnings per share (EPS)

Return on average assets

Return on average equity

Five-year summary of the statement of financial position

Description 2022
SAR ‘000
SAR ‘000
SAR ‘000
SAR ‘000
SAR ‘000
Cash and balances with Central Bank 42,052,496 40,363,449 47,362,522 39,294,099 43,246,043
Due from banks and other financial institutions, net 25,655,929 26,065,392 28,654,842 32,058,182 32,387,760
Investments, net 102,146,142 84,433,395 60,285,272 46,842,630 43,062,565
Financing, net 568,338,114 452,830,657 315,712,101 249,682,805 231,758,206
Investment properties, net 1,364,858 1,411,469 1,541,211 1,383,849 1,297,590
Property and equipment, net 11,338,782 10,665,799 10,234,785 10,407,247 8,649,435
Other assets, net 11,469,701 7,874,467 5,033,990 4,417,764 3,629,245
Total Assets 762,366,022 623,644,628 468,824,723 384,086,576 364,030,844
Dues to banks and other financial institutions 70,839,117 17,952,140 10,764,061 2,219,604 7,289,624
Customers’ deposits 564,924,688 512,072,213 382,631,003 312,405,823 293,909,125
Other liabilities 26,377,182 26,338,711 17,311,141 18,269,492 14,526,229
Total liabilities 662,140,987 556,363,064 410,706,205 332,894,919 315,724,978
Share capital 40,000,000 25,000,000 25,000,000 25,000,000 16,250,000
Statutory reserve 29,287,706 25,000,000 25,000,000 21,789,632 16,250,000
Other reserves (427,569) 282,107 (134,728) (216,041) (349,555)
Retained earnings 9,864,898 16,999,457 8,253,246 868,066 12,499,171
Proposed dividends 5,000,000 0 0 3,750,000 3,656,250
Equity attributable to shareholders of the Bank 83,725,035 67,281,564 58,118,518 51,191,657 48,305,866
Tier 1 Sukuk 16,500,000 0 0 0 0
Total equity 100,225,035 67,281,564 58,118,518 51,191,657 48,305,866
Total liabilities and equity 762,366,022 623,644,628 468,824,723 384,086,576 364,030,844


Al Rajhi Bank passed the SAR 700 Bn. milestone in total assets during the reporting period, closing the year with assets amounting to SAR 741 Bn., a 27% growth YoY. The Bank’s asset quality continued to be the best in the market with 97.5% of our financing portfolio recognised as stage 1 assets. Stage 2 and stage 3 assets stood at 1.7% and 0.8% of the financing portfolio respectively, with coverage ratios for stage 3 standing at 64%, stage 2 at 18% and stage 1 at 0.58%, all higher than market average. Our prudent risk management continued to be reflected in our NPL ratio which was the lowest in the market, reducing from 0.65% in 2021 to 0.54% in 2022, the fourth consecutive year of improvement for this KPI. Additionally, the Bank’s NPL coverage ratio too, lead the banking sector at a healthy 260%.

NPL coverage

Deposits and other liabilities

Total liability of Al Rajhi Bank stood at SAR 662 Bn., a YoY increase of 19%. Customer deposits increased by SAR 53 Bn. during the year under review, a growth of 10% YoY to reach SAR 565 Bn., with demand deposits making-up almost 64% of total customer deposits. Time deposits also recorded a strong growth in 2022, increasing by SAR 72 Bn. YoY. Interbank borrowing increased by SAR 53 Bn., which also included a SAR 4.4 Bn. of USD syndicated green loan considered to be the largest Sharia-compliant syndication in the Middle East.


With a strong balance sheet backed by market-leading asset quality and NPL ratio, healthy regulatory liquidity position and comfortable levels of capital ratios, Al Rajhi Bank successfully maintained its steady growth and consistent performance, demonstrating the stability, shareholder loyalty and creditworthiness of the Bank.


Al Rajhi Bank continued to maintain a strong capitalisation profile above regulatory minimum requirements with a Core Equity Tier 1 (CET1) ratio of 17.0% and a total capital adequacy ratio of 21.4%, marginally higher than the ratios recorded in 2021. A 17% YoY increase in Risk-Weighted Assets (RWA) arising primarily from growth in the financing portfolio led to 18% increase in Credit Risk RWAs, impacting our capital ratios. However, a decrease in RWA density from 68.2% in 2021 to 65.3% in 2022 demonstrated the Bank’s improving risk quality of assets. The reporting period saw the Bank focused on strong internal capital generation to help support the capital position of the Bank, while also exploring new business opportunities.


Al Rajhi Bank’s liquidity position remained healthy and within the regulatory requirements, with a regulatory Loan-to-Deposit Ratio (LDR) of 85.9% in line with our internal optimised level. The Bank’s Net Stable Funding Ratio (NSFR) and Liquidity Coverage Ratio (LCR) stood at comfortable levels at 110% and 126% respectively, and above statutory minimum requirement. Al Rajhi Bank recorded a 25% YoY growth of High Quality Liquid Assets (HQLA) amounting to SAR 118 Bn., as at 31 December 2022.

Geographical analysis of the total income of the bank and its subsidiaries 2022
SAR ‘000
KSA 29,342,624
Middle East and East Asia 470,444
Total 29,813,068


Future outlook

Future outlook

Al Rajhi Bank will continue to focus on delivering BOTF strategy KPIs, with our key focus steady on the Bank’s core business franchise across retail, corporate and SME segments, capturing new business opportunities given the positive outlook of the Saudi economy. The implementation of BOTF strategy will support the Bank to optimise synergies across the Bank’s subsidiaries, and nurture a financial ecosystem that will provide our loyal customers with rapidly evolving financial solutions to address their ever-changing needs.