Al Rajhi Bank · TADAWUL:1120
Al Rajhi Bank — Q3 2024 Earnings Presentation
36 slides from Al Rajhi Bank's earnings presentation, 2024
Slide 1: Al Rajhi Bank Investor Presentation 3Q 2024
Al Rajhi Bank Investor Presentation 3Q 2024
Slide 2: 3Q 2024 Investor Presentation
3Q 2024 Investor Presentation 03 The World’s Leading Islamic Bank 12 Harmonize the group Strategy 14 KSA Macro-Economic Environment 17 3Q 2024 Financial Highlights 31 FY 2024 Guidance 34 IR Contact Information 3Q 2024 Investor Presentation 2
Slide 3: The World's Leading Islamic Bank
The World’s Leading Islamic Bank
Slide 4: Al Rajhi Bank | Islamic Banking, Everywhere
Al Rajhi Bank | Islamic Banking, Everywhere At a glance, 3Q 2024 Presence & Branches, 3Q 2024 100% 72% Jordan Kuwait Islamic CASA Customers 10 2 512 4,420 Branches ATMs 17.8 million 84% 94 : 6 +726k 136 NPS Digital : Manual 512 Remittance 13 POS Centers Saudi Arabia Malaysia Largest network in Saudi
Slide 5: Top Facts About Al Rajhi Bank
Top 10 Facts About Al Rajhi Bank Largest Islamic Bank worldwide #1 Bank in KSA 1 (by Assets & Market Cap) 6 (by number of customers) #1 Retail Bank in Middle East #1 Distribution network in Middle East 2 (Retail Deposits & Income) 7 (by # of Branches, POS, ATMs, Remittance Centres) One of the highes
Slide 6: Robust balance sheet with 72% CASA deposits in 9M 2024
The World’s Leading Islamic Bank | Robust balance sheet with 72% CASA deposits in 9M 2024 Total Assets (SARbn) Capital Ratios (%) +92.5% 0 1,200 903 0 21.4% 21.5% 1,000 762 808 0 20.7% 19.1% 800 624 20.3% 20.4% 0 600 469 17.5% 19.7% 18.0% 0 400 16.4% 17.0% 17.2% 0 200 0 16.2% 0 0 2020 2021 2022 2023
Slide 7: What sets Al Rajhi Bank Apart: largest retail banking business
What sets Al Rajhi Bank Apart | ARB has the largest retail banking business in the Kingdom Market Share - Demand Deposits Market Share - Deposits 1 17.8 +365bps +350bps 0 0 0 24.2% 24.6% 23.2% 22.9% 27.9% 0 0 24.3% 25.9% 25.2% 24.6% 19.4% Million 0 0 0 0 Active Customers 0 0 0 0 2020 2021 2022 2023
Slide 8: Al Rajhi Bank's Leading Network
Al Rajhi Bank’s Leading Network | The Bank has the largest distribution network in Saudi Arabia #1 in Branches #1 in ATMs Market Share - Branches Market Share - ATMs -19bps +41bps 0 0 0 0 29.6% 29.1% 0 28.6% 0 0 27.0% 26.8% 26.8% 26.9% 26.8% 0 28.2% 28.5% 0 0 0 0 0 0 0 0 0 0 0 0 2020 2021 2022 2023
Slide 9: Unique franchise with leading market share across key products
Al Rajhi Bank has a unique franchise | We maintain a leading market share across key products #1 in Personal Loans #1 in Auto Loans Market Share - Personal Loans Market Share - Auto Loans 1 1 1 -30bps 1 -630bps 44.6% 44.3% 51.8% 51.7% 1 41.0% 47.6% 1 40.6% 40.3% 43.7% 41.3% 1 0 0 0 0 0 0 0 0 0 0 202
Slide 10: Al Rajhi Bank Market Performance
Al Rajhi Bank Market Performance | ARB maintained its momentum and outperform its peer group • Share Price Performance Top 3 KSA Banks (Daily; Rebased to 100) 30 Sep 2024 RAJHI SNB Riyad TASI 300 Key Metrics Closing Price SAR 87.2 Market Cap SAR 349 bn 250 Market Cap / % Industry 37.4% Market Cap /
Slide 11: ESG Highlights
ESG Highlights 214 USD 4.6 bn Scholarships to Orphan ISO/DIS 37301:2020 Green syndicated loan students to join Compliance Universities Started using solar +39k energy system in 61 Families have been +22k ISO 22301:2019 benefited from the Employees across the Business Continuity branches to reduce af
Slide 12: Our strategy "Harmonize the group"
Our strategy “Harmonize the group”
Slide 13: "Harmonize the Group" | Highlights on our strategy performance
“Harmonize the Group” | Highlights on our strategy performance Business to Business to Support Digital & Data Consumer Business Businesses Leverage customer Become ‘main bank’ Centralization Expand digital base via cross-sell of large corporates and standardization capabilities Group-wide % of custo
Slide 14: KSA's Macro-Economic Environment
KSA’s Macro–Economic Environment
Slide 15: KSA Economic Outlook
KSA Economic Outlook | Economic conditions remain positive for the Kingdom Highlights GDP Growth/Brent Oil Price 99.0 • Saudi GDP is expected to increase by 2.8% in 3Q 2024 driven by higher 9.0 82.5 87.0 84.8 100.0 non-oil activities 7.0 70.9 80.0 8.7 5.0 • IMF revised Saudi’s GDP growth forecasts t
Slide 16: Banking Sector Highlights
Banking Sector Highlights | Banking system deposits continue growing in the third quarter 2024 SAMA LDR (%) & Bank Loans and Deposits (SARmn) Recent Developments 79.5% 81.5% 80.7% 2,853 79.7% 75.0% 2,719 2,584 2,800 80.0% • Deposits have grown in the banking system by end of September 2024 2,473 2,3
Slide 17: 3Q 2024 Financial Highlights
3Q 2024 Financial Highlights
Slide 18: 3Q 2024 Results Summary
3Q 2024 Results Summary | Results are above expectations in the first 9M 2024 9.2% YTD Growth in financing portfolio 11.9% Growth in liabilities LDR below regulatory minima 11.7% YTD Balance Net Financing Total Liabilities Loan to Deposit Ratio Sheet Growth 594.2bn +9.2% 649.0bn 701.3bn +11.9% 784.7
Slide 19: Balance Sheet Trends (1)
Balance Sheet Trends (1) | Balance sheet growth of 11.7% YTD driven by Financing and Investments Total Assets (SARbn) SAR (mn) 3Q 24 2Q 24 QoQ 4Q 23 YTD +12.7% Cash & balances with SAMA 45,085 42,467 +6% 41,768 +8% 1,200 Due from banks & other FI 15,433 14,126 +9% 9,507 +62% 1,000 867 903 801 808 83
Slide 20: Balance Sheet Trends (2)
Balance Sheet Trends (2) | Financing growth is driven by Mortgage and Corporate Financing, Net (SARbn) Financing, Net Mix By Segment Retail Financing, Gross Mix By (SARbn) Segment (SARbn) Corporate 850 +9.9% Auto Loans SAR 162bn SME SAR 21bn 649.0 25% 750 34.9 SAR 35bn 4% Credit Cards 590.8 594.2 28
Slide 21: Balance Sheet Trends (3)
Balance Sheet Trends (3) | Balance sheet shows improving funding mix Total Liabilities (SARbn) Total Customers' Deposits Mix By Total Liabilities Mix By Segment Type (SARbn) (SARbn) Treasury +12.3% 1,000 SAR 144bn Customers’ Time 784.7 Other 18% 32.0 Investments 698.5 701.3 customer Rajhi 28.8 800 2
Slide 22: Net Income Trends
Net Income Trends | highest-ever 9M net income with a 14% growth YoY Net Income For The Period After Zakat (SARmn) SAR (mn) 9M 24 9M 23 YoY 3Q 24 3Q 23 YoY Net financing & investment income 17,902 15,720 +14% 6,397 5,401 +18% +22.8% 8,000 7,000 Fee from banking services, net 3,404 3,238 +5% 1,242 89
Slide 23: Operating Income Trends
Operating Income Trends | Higher operating income driven by net yield and fee income growth Total Operating Income (SARmn) Total Operating Income Growth Drivers By Type (SARmn) 14,000 30,000 12,000 +22.8% +13.8% 25,000 8,439 2,182 167 31 445 23,305 10,000 7,229 7,637 20,481 7,051 20,000 8,000 6,873
Slide 24: Expenses Trends
Expenses Trends | Cost efficiencies remains solid Operating Expenses (SARmn) Operating Expenses Growth Drivers By Type (SARmn) 6,000 3,500 3,000 +11.3% 5,000 +7.6% 2,070 282 5,920 2,500 1,998 1,956 139 4,000 2,000 1,860 1,894 5,500 (1) 3,000 1,500 2,000 1,000 1,000 500 0 0 3Q 23 4Q 23 1Q 24 2Q 24 3Q
Slide 25: Net Impairment & Cost of Risk
Net Impairment & Cost of Risk | Higher gross charge due to Financing portfolio growth Net Impairment Charges (SARmn) Cost of Risk (%) 1,450 1,250 +81.4% 0 1,050 0 688 850 0.33% 0.28% 0 650 0.25% 0.25% 0.28% 406 421 455 379 0 450 0 250 50 (0) 3Q 23 4Q 23 1Q 24 2Q 24 3Q 24 9M 23 FY 23 1Q 24 1H 24 9M 2
Slide 26: Asset Quality Trends (1)
Asset Quality Trends (1) | Asset quality remains healthy with a high NPL coverage Movement in NPL (SARmn) NPL Formation (SARmn) 4,500 8,000 +21.2% +21.2% 4,000 543 5,211 7,000 3,500 3,759 5,211 370 6,000 3,000 2,500 4,298 5,000 4,298 4,000 2,000 3,000 1,500 2,000 1,000 1,000 (2,846) 500 0 0 4Q 23 Re
Slide 27: Asset Quality Trends (2)
Asset Quality Trends (2) | Healthy stage coverage reflecting prudent risk management ECL by Stage (SARmn) Movement in ECL by Group (SARmn) 12,000 10,000 8,613 8,726 8,608 10,000 -0.1% 8,000 8,613 596 8,608 8,000 6,000 4,101 4,507 4,143 6,000 (600) 1,649 1,832 4,000 1,695 4,000 2,000 2,863 2,000 2,52
Slide 28: Liquidity Trends
Liquidity Trends | Liquidity remains comfortably within regulatory requirements HQLA (SARbn) Loan to Deposits Ratio (SAMA) (%) 200 -0.3% Regulatory 1 Maximum 90% 131.3 131.0 1 82.9% 150 121.1 81.0% 79.7% 105.5 105.4 1 78.7% 78.3% 100 1 1 50 1 0 0 3Q 23 4Q 23 1Q 24 2Q 24 3Q 24 3Q 23 4Q 23 1Q 24 2Q 24
Slide 29: Capitalization Trends
Capitalization Trends | Capital position well above regulatory minima RWA (SARbn) Total Capital (SARbn) 180 800 700 +11.3% 160 +10.9% 577.8 520.3 47.0 119.7 140 600 519.4 107.9 112.0 38.4 38.4 120 500 9.8 6.0 400 7.6 10.8 100 5.9 5.8 80 300 473.3 471.0 521.0 106.2 113.7 60 200 40 102.0 100 20 0 0 3Q
Slide 30: Return Metrics
Return Metrics | Al Rajhi Bank’s returns remain industry-leading Return on RWA (%) Earnings per Share (SAR) 0 2 0 +23.0% 1.22 2 0 1.05 1.12 3.45% 0.99 0.99 3.35% 0 3.26% 3.26% 3.30% 1 0 0 1 0 0 0 9M 23 FY 23 1Q 24 1H 24 9M 24 3Q 23 4Q 23 1Q 24 2Q 24 3Q 24 Return on Equity (%) Return on Assets (%) 0
Slide 31: FY 2024 Guidance
FY 2024 Guidance
Slide 32: FY 2024 Assumptions and Outlook
FY 2024 Assumptions and Outlook | Interest rates are expected to continue decreasing by end of 2024 • Saudi real GDP is expected to improve by 2.8% in 3Q 2024 driven by 4.2% higher non-oil activities • IMF has revised Saudi GDP growth forecasts to 1.5% in 2024 and projected 4.6% for 2025 Economy • C
Slide 33: FY 2024 Guidance | For our strategy "Harmonize the Group"
FY 2024 Guidance | For our strategy “Harmonize the Group“ FY 2024 Guidance 9M 2024 Actual Guidance Revision Balance Sheet Financing Mid single digit +9.2% Low teens Net profit margin +5 bps to +15 bps +9 bps +10 bps to +20 bps Profitability Cost to income ratio Below 27% 25.4% Below 25.5% ROE Above
Slide 34: IR Contact Information
IR Contact Information
Slide 35: Additional Information
Additional Information | Contact investor relations for more information Mr. Sulaiman Alquraishi Investors Relations +966 (11) 828 1987 Alquraishis@alrajhibank.com.sa IR@alrajhibank.com.sa Mr. Mohammed M. Alqahtani Mr. Abdulsalam Alsukaiti +966 (11) 828 1921 +966 (11) 828 1942 AlqahtaniM-M@alrajhiba
Slide 36: Disclaimer
Disclaimer • AL RAJHI BANK HEREIN REFERRED TO AS ARB MAKES NO REPRESENTATION OR WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY REGARDING THIS DOCUMENT OR THE MATERIALS AND INFORMATION CONTAINED OR REFERRED TO ON EACH PAGE ASSOCIATED WITH THIS DOCUMENT. THE MATERIAL AND INFOR- MATION CONTAINED O