BSF Financial Q2 2025 - English

BANQUE SAUDI FRANSI

(A SAUDI JOINT STOCK COMPANY)

CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTH PERIOD ENDED

JUNE 30, 2025

Deloitte and Touche & Co.

Chartered Accountants

REVIEW REPORT ON THE CONDENSED INTERIM CONSOLIDATED FINANCIAL INFORMATION

To: The Shareholders of Banque Saudi Fransi (A Saudi Joint Stock Company)

Introduction

We have reviewed the accompanying condensed interim consolidated statement of financial position of Banque Saudi Fransi

Group 0 June 2025, and the related

condensed interim consolidated statements of income and comprehensive income for the three-month and six-month periods ended 30 June 2025, and the related condensed interim consolidated statements of changes in equity and cash flows for the six-month period then ended, and explanatory notes. Management is responsible for the preparation and presentation of these condensed interim consolidated financial information in accordance with International Accounting Standard 34,

is to express a conclusion on these condensed interim consolidated financial information based on our review.

Scope of review

Review of Interim as endorsed in the Kingdom of Saudi Arabia.

A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing that are endorsed in the Kingdom of Saudi Arabia and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion

Based on our review, nothing has come to our attention that causes us to believe that the accompanying condensed interim consolidated financial information is not prepared, in all material respects, in accordance with IAS 34 as endorsed in the Kingdom of Saudi Arabia.

28 July 2025

The accompanying notes 1 to 25 form an integral part of these condensed interim consolidated financial statements.

Ramzy Darwish Bader AlSalloom Mazin AlRomaih

Chief Financial Officer Chief Executive Officer Chairman of the Board

The accompanying notes 1 to 25 form an integral part of these condensed interim consolidated financial statements.

Ramzy Darwish Bader AlSalloom Mazin AlRomaih

Chief Financial Officer Chief Executive Officer Chairman of the Board

The accompanying notes 1 to 25 form an integral part of these condensed interim consolidated financial statements.

Ramzy Darwish Bader AlSalloom Mazin AlRomaih

Chief Financial Officer Chief Executive Officer Chairman of the Board

BANQUE SAUDI FRANSI (A Saudi Joint Stock Company) Page 4 CONDENSED INTERIM CONSOLIDATED STATEMENT OF CHANGES IN EQUITY Unaudited

The accompanying notes 1 to 25 form an integral part of these condensed interim consolidated financial statements.

Ramzy Darwish Bader AlSalloom Mazin AlRomaih



Chief Financial Officer Chief Executive Officer Chairman of the Board

The accompanying notes 1 to 25 form an integral part of these condensed interim consolidated financial statements.

Ramzy Darwish Bader AlSalloom Mazin AlRomaih



Chief Financial Officer Chief Executive Officer Chairman of the Board

1. General

   Banque Saudi Fransi (the Bank) is a Saudi Joint Stock Company established by Royal Decree No. M/23 dated Jumada Al Thani 17, 1397H (corresponding to June 04, 1977). The Bank formally commenced its activities on Muharram 01, 1398H (corresponding to December 11, 1977), by taking over the branches of the Banque de l'Indochine et de Suez in the Kingdom of Saudi Arabia. The Bank operates under Commercial Registration Number 1010073368 dated Safar 04, 1410H (corresponding to September 05, 1989), through its 80 branches (June 30,

   2024: 82 branches) in the Kingdom of Saudi Arabia, employing 3,087 people (June 30, 2024: 3,180 people).

   The objective of the Bank is to provide a full range of banking services, including Islamic products, which are

   approved and supervised by an independent Shariah Board. The Bank's Head Office is located at King Saud Road,

   P.O. Box 56006, Riyadh 11554, Kingdom of Saudi Arabia.

   The Bank is regulated by the Saudi Central Bank (SAMA).

   The consolidated financial statements comprise the financial statement of Banque Saudi Fransi and its wholly

   owned subsidiaries (collectively referred to as the "Group").

   Subsidiary	Ownership	Main activities
   Saudi Fransi Capital (BSF Capital)	100%	Brokerage, asset management and corporate finance business
   Saudi Fransi for Finance Leasing (rebranded from SFL to JB)	100%	Islamic lease financing for vehicles and personal financing
   Saudi Fransi Insurance Agency (SAFIA)	100%	Insurance agent for Banque Saudi Fransi in Saudi Arabia (under liquidation)
   Sofinco Saudi Fransi	100%	Lease financing of automobiles and household equipment (under liquidation)
   Saudi Fransi Digital Ventures (SFDV)	100%	Providing digital services to Banque Saudi Fransi (under liquidation)
   Sakan Real Estate Financing	100%	Sakan holds title deeds on behalf of Banque Saudi Fransi (Banque Saudi Fransi holds 95% direct ownership and 5% indirect ownership through its subsidiary)
   Sur Multi Family Office Limited	100%	Provides a wide range of wealth management services to BSF's high net worth clients and their families

   The above subsidiaries are incorporated in the Kingdom of Saudi Arabia except for Sur Multi Family Office which is registered in United Kingdom.

   The Bank also formed subsidiaries, BSF Markets Limited and BSF Finance Limited registered in Cayman Islands having 100% share in equity in each of these subsidiaries. The objective of BSF Markets Limited is derivative trading and Repo activities. BSF Finance Limited is a special purpose vehicle established to raise capital for Banque Saudi Fransi by the issuance of debt instruments.

   The Bank has investment in an associate and has shareholding in Banque BEMO Saudi Fransi, incorporated in Syria. Banque Bemo Saudi Fransi offers diverse banking services and solutions to individuals and companies.

2. Basis of preparation

   The condensed interim consolidated financial statements of the Group as at and for the period ended June 30, 2025 have been prepared in accordance with International Accounting Standard 34 - Interim Financial Reporting ("IAS 34") as endorsed in the Kingdom of Saudi Arabia and other standards and pronouncements issued by the Saudi Organization for Chartered and Professional Accountants ("SOCPA"). The condensed interim consolidated financial statements do not include all the information and disclosures required in the annual financial statements, and should be read in conjunction with the Group's annual financial statements as at December 31, 2024.

   The consolidated financial statements of the Group as at and for the year ended December 31, 2024, were prepared in accordance with IFRS Accounting Standards as endorsed in the Kingdom of Saudi Arabia and other standards and pronouncements that are endorsed by the SOCPA. The condensed interim consolidated financial statements are expressed in Saudi Arabian Riyals (

   ) and amounts are rounded to the nearest thousand.
   
   
3. Basis of consolidation

   The new Companies Law issued through Royal Decree M/132 on 1/12/1443H (corresponding to June 30, 2022) (hereinafter referred as "the Law") came into force on 26/6/1444H (corresponding to January 19, 2023). For certain provisions of the Law, full compliance is expected not later than two years from 26/6/1444H (corresponding to January 19, 2023). The management has assessed the impact of the New Companies Law and amended its Articles of Association / By-Laws for changes to align the Articles to the provisions of the Law. General Assembly on December 23, 2024 approved on amending the Bank's Bylaws to comply with the new Companies Law, and rearranging the articles and numbering them to be compatible with the proposed amendments

   The condensed interim consolidated financial statements comprise the financial statements of the Bank and its subsidiaries. The financial statements of the subsidiaries are prepared for the same reporting period as that of the Bank, using consistent accounting policies. Adjustments are made wherever necessary in the financial statements of the subsidiaries to align with the Bank's condensed interim consolidated financial statements.

   Subsidiaries are the entities that are controlled by the Bank. The Bank controls an entity when it is exposed, or has a right, to variable returns from its involvement with the entity and has the ability to affect those returns through its power over that entity.

   Subsidiaries are consolidated from the date on which control is transferred to the Bank and cease to be consolidated from the date on which the control is transferred from the Bank. The results of subsidiaries acquired or disposed during the period, if any, are consolidated in the condensed interim consolidated statement of income from the effective date of the acquisition or up to the effective date of disposal, as appropriate.

   Balances between the Bank and its subsidiaries, and any unrealised income and expenses arising from intra-group transactions, are eliminated in preparing the condensed interim consolidated financial statements. Unrealised losses are eliminated in the same way as unrealised gains, but only to the extent that there is no evidence of impairment.

4. Material Accounting Policies and Estimates

The accounting policies, estimates and assumptions used in the preparation of these condensed interim consolidated financial statements are consistent with those used in the preparation of the annual consolidated financial statements for the year ended December 31, 2024.

New standards, interpretations and amendments adopted by the Group

The accounting policies adopted in the preparation of the condensed interim consolidated financial statements are consistent with those followed in the preparation of the Group's annual consolidated financial statements for the year ended December 31, 2024, except for the adoption of new standards effective as of January 01, 2025. The Group has not early adopted any standard, interpretation or amendment that has been issued but is not yet effective. Several amendments apply for the first time in 2025, but do not have a significant impact on the condensed interim consolidated financial statements of the Group.

New standards issued but not yet effective

1. Material Accounting Policies and Estimates (continued)

   Standard, interpretation, amendments	Description	Effective date
   Amendments to IFRS 9 Financial Instruments and IFRS 7 Financial Instruments: Disclosures	Under the amendments, certain financial assets including those with ESG-linked features could now meet the SPPI criterion, provided that their cash flows are not significantly different from an identical financial asset without such a feature. The IASB has amended IFRS 9 to clarify when a financial asset or a financial liability is recognized and derecognized and to provide an exception for certain financial liabilities settled using an electronic payment system.	January 01, 2026
   IFRS 18, Presentation and Disclosure in Financial Statements	IFRS 18 provides guidance on items in statement of profit or loss classified into five categories: operating; investing; financing; income taxes and discontinued operations It defines a subset of measures related to an entity's financial performance as 'management-defined performance measures' ('MPMs'). The totals, subtotals and line items presented in the primary financial statements and items disclosed in the notes need to be described in a way that represents the characteristics of the item. It requires foreign exchange differences to be classified in the same category as the income and expenses from the items that resulted in the foreign exchange differences.	January 01, 2027
   IFRS 19, Subsidiaries without Public Accountability: Disclosures	IFRS 19 allows eligible subsidiaries to apply IFRS Accounting Standards with the reduced disclosure requirements of IFRS 19. A subsidiary may choose to apply the new standard in its consolidated, separate or individual financial statements provided that, at the reporting date it does not have public accountability and its parent produces consolidated financial statements under IFRS Accounting Standards.	January 01, 2027
   IFRS S1, 'General requirements for disclosure of sustainability-related financial information	This standard includes the core framework for the disclosure of material information about sustainability-related risks and opportunities across an entity's value chain.	Not yet endorsed by SOCPA

2. Cash and balances with Saudi Central Bank

   '000	June 30, 2025 (Unaudited)	December 31, 2024 (Audited)	June 30, 2024 (Unaudited)
   Cash on hand	939,625	874,134	1,345,767
   Current account	80,124	109,209	140,741
   Statutory deposit	9,979,558	9,937,263	9,517,440
   Money market placements	-	-	574,000
   Total	10,999,307	10,920,606	11,577,948

3. Due from banks and other financial institutions, net

   '000	June 30, 2025 (Unaudited)	December 31, 2024 (Audited)	June 30, 2024 (Unaudited)
   Current accounts Money market placements Less: impairment	2,065,128 4,793,634	2,026,792 2,989,639	6,114,077 5,630,606
   	6,858,762 (775)	5,016,431 (621)	11,744,683 (2,457)
   Total	6,857,987	5,015,810	11,742,226

   1. The following table shows the stage wise movement in ECL allowance for due from banks and other financial institutions:

      '000	June 30, 2025 (Unaudited)
      	12 month ECL	Lifetime ECL not credit impaired	Lifetime ECL credit impaired	Total
      Balance at January 01	462	159	-	621
      Transfer from 12-month ECL	-	-	-	-
      Transfer from lifetime ECL not credit impaired	-	-	-	-
      Net (reversal) / charge for the period	(35)	189	-	154
      Balance at the end of the period	427	348	-	775

      '000	December 31, 2024 (Audited)
      	12 month ECL	Lifetime ECL not credit impaired	Lifetime ECL credit impaired	Total
      Balance as at January 01, 2024	590	315	-	905
      Net reversal for the year	(128)	(156)	-	(284)
      Balance as at December 31, 2024	462	159	-	621

      1. Due from banks and other financial institutions, net (continued)

         '000	June 30, 2024 (Unaudited)
         	12 month ECL	Lifetime ECL not credit impaired	Lifetime ECL credit impaired	Total
         Balance at January 01	590	315	-	905
         Transfer from 12-month ECL	-	-	-	-
         Transfer from lifetime ECL not credit impaired	-	-	-	-
         Net charge for the period	1,375	177	-	1,552
         Balance at the end of the period	1,965	492	-	2,457

   2. The following table shows the gross carrying amount of the due from banks and other financial institutions:

1. Investments, net

1. Investment securities are classified as follows:

   '000	June 30, 2025 (Unaudited)	December 31, 2024 (Audited)	June 30, 2024 (Unaudited)
   Investment at amortized cost - gross Less: impairment Investment at amortized cost, net Investments at FVOCI - Debt instruments Investments at FVOCI - Equity/other investments Total FVOCI Investment at FVSI - Debt/equity instruments	28,003,345 (15,072)	27,695,178 (17,013)	27,728,879 (16,189)
   	27,988,273 34,027,813 604,076	27,678,165 31,824,414 428,367	27,712,690 26,811,723 393,303
   	34,631,889 172,113	32,252,781 357,912	27,205,026 870,924
   Total	62,792,275	60,288,858	55,788,640

   Gross Investments include Shariah based investments amounting to

   44,497 million (December 31, 2024:
   40,413 million; June 30, 2024:
   37,653 million).
   
   
2. Investments held at fair value through statement of income (FVSI) Investments by type of securities

   '000	June 30, 2025 (Unaudited)			December 31, 2024 (Audited)			June 30, 2024 (Unaudited)
   	Domestic	International	Total	Domestic	International	Total	Domestic	International	Total
   Fixed-rate securities	170,880	-	170,880	357,912	-	357,912	588,147	-	588,147
   Floating-rate securities Equities	- 1,233	- -	- 1,233	- -	- -	- -	- -	- 282,777	- 282,777
   Total	172,113	-	172,113	357,912	-	357,912	588,147	282,777	870,924

3. Investments held at fair value through other comprehensive income (FVOCI) Investments by type of securities

   '000	June 30, 2025 (Unaudited)			December 31, 2024 (Audited)			June 30, 2024 (Unaudited)
   	Domestic	International	Total	Domestic	International	Total	Domestic	International	Total
   Fixed-rate securities	21,950,001	8,620,376	30,570,377	17,313,251	10,630,748	27,943,999	15,978,932	6,812,684	22,791,616
   Floating-rate securities Equities and others	2,912,635 593,415	544,801 10,661	3,457,436 604,076	3,072,313 417,774	808,102 10,593	3,880,415 428,367	2,986,474 383,068	1,033,633 10,235	4,020,107 393,303
   Total	25,456,051	9,175,838	34,631,889	20,803,338	11,449,443	32,252,781	19,348,474	7,856,552	27,205,026

   7. Investments, net (continued)
4. Investments held at amortised cost Investments by type of securities

   '000	June 30, 2025 (Unaudited)			December 31, 2024 (Audited)			June 30, 2024 (Unaudited)
   	Domestic	International	Total	Domestic	International	Total	Domestic	International	Total
   Fixed-rate securities Floating-rate securities	27,150,265 838,008	- -	27,150,265 838,008	26,839,229 838,936	- -	26,839,229 838,936	26,877,156 835,534	- -	26,877,156 835,534
   Total	27,988,273	-	27,988,273	27,678,165	-	27,678,165	27,712,690	-	27,712,690

   1. The following table shows the stage wise movement in ECL allowance for debt instruments held at FVOCI and amortised cost:

      '000	June 30, 2025 (Unaudited)
      	12 month ECL	Lifetime ECL not credit impaired	Lifetime ECL credit impaired	Total
      Balance at January 01	44,582	-	-	44,582
      Net reversal for the period	(2,568)	-	-	(2,568)
      Balance at the end of the period	42,014	-	-	42,014

      '000	December 31, 2024 (Audited)
      	12 month ECL	Lifetime ECL not credit impaired	Lifetime ECL credit impaired	Total
      Balance at January 01	33,739	-	-	33,739
      Net charge for the year	10,843	-	-	10,843
      Balance at the end of the year	44,582	-	-	44,582

      '000	June 30, 2024 (Unaudited)
      	12 month ECL	Lifetime ECL not credit impaired	Lifetime ECL credit impaired	Total
      Balance at January 01	33,739	-	-	33,739
      Net charge for the period	2,217	-	-	2,217
      Balance at the end of the period	35,956	-	-	35,956

      1. Investments, net (continued)

   2. The following table shows the stage wise gross carrying value of debt instruments:

1. Loans and advances, net

   1. Loans and advances held at amortised cost are classified as follows:

      '000	June 30, 2025 (Unaudited)
      	Overdraft & Commercial Loans	Credit Cards	Consumer Loans	Total
      Performing loans and advances - gross Non-performing loans and advances, net Total loans and advances Allowance for impairment Loans and advances held at amortised cost, net	170,257,325 1,744,057	818,581 23,724	40,519,855 295,494	211,595,761 2,063,275
      	172,001,382 (3,336,333)	842,305 (47,432)	40,815,349 (394,474)	213,659,036 (3,778,239)
      	168,665,049	794,873	40,420,875	209,880,797

      '000	December 31, 2024 (Audited)
      	Overdraft & Commercial Loans	Credit Cards	Consumer Loans	Total
      Performing loans and advances - gross Non-performing loans and advances, net Total loans and advances Allowance for impairment Loans and advances held at amortised cost, net	167,950,716 1,637,925	724,210 24,568	37,073,642 272,006	205,748,568 1,934,499
      	169,588,641 (3,118,432)	748,778 (44,235)	37,345,648 (352,125)	207,683,067 (3,514,792)
      	166,470,209	704,543	36,993,523	204,168,275

      '000	June 30, 2024 (Unaudited)
      	Overdraft & Commercial Loans	Credit Cards	Consumer Loans	Total
      Performing loans and advances - gross Non-performing loans and advances, net Total loans and advances Allowance for impairment Loans and advances held at amortised cost, net	163,153,095 1,560,544	679,052 42,811	34,490,309 275,897	198,322,456 1,879,252
      	164,713,639 (2,648,903)	721,863 (51,727)	34,766,206 (341,012)	200,201,708 (3,041,642)
      	162,064,736	670,136	34,425,194	197,160,066

      Gross Loans and advances include Shariah based loans and advances amounting to

      157,562 million (December 31, 2024:
      154,194 million; June 30, 2024:
      142,866 million).
      
      

   2. The movement in the allowance for impairment of loans and advances to customers for the period is as follows:

      '000	June 30, 2025 (Unaudited)	December 31, 2024 (Audited)	June 30, 2024 (Unaudited)
      Opening loss allowance as at January 01	3,514,792	2,643,990	2,643,990
      Charge for the period / year, net	583,101	1,287,934	646,081
      Bad debts written off against provision	(319,654)	(417,132)	(248,429)
      Balance at the end of the period / year	3,778,239	3,514,792	3,041,642

      8. Loans and advances, net (continued)

   3. The following table shows the stage wise movement in ECL allowance for loans and advances:

      '000	June 30, 2025 (Unaudited)
      	12 month ECL	Lifetime ECL not credit impaired	Lifetime ECL credit impaired	Total
      Balance at January 01	945,871	1,247,200	1,321,721	3,514,792
      Transfer from12-month ECL	(10,555)	8,066	2,489	-
      Transfer from lifetime ECL not credit impaired	42,669	(133,410)	90,741	-
      Transfer from Lifetime ECL credit impaired	15,382	4,091	(19,473)	-
      Net (reversal) / charge for the period	(14,169)	144,076	453,194	583,101
      Write-offs	-	-	(319,654)	(319,654)
      Balance at the end of the period	979,198	1,270,023	1,529,018	3,778,239

      '000	December 31, 2024 (Audited)
      	12 month ECL	Lifetime ECL not credit impaired	Lifetime ECL credit impaired	Total
      Balance at January 01	509,846	849,666	1,284,478	2,643,990
      Transfer from12-month ECL	(8,925)	7,473	1,452	-
      Transfer from lifetime ECL not credit impaired	20,890	(64,289)	43,399	-
      Transfer from Lifetime ECL credit impaired	12,673	160,671	(173,344)	-
      Net charge for the year	411,387	293,679	582,868	1,287,934
      Write-offs	-	-	(417,132)	(417,132)
      Balance at the end of the year	945,871	1,247,200	1,321,721	3,514,792

      '000	June 30, 2024 (Unaudited)
      	12 month ECL	Lifetime ECL not credit impaired	Lifetime ECL credit impaired	Total
      Balance at January 01	509,846	849,666	1,284,478	2,643,990
      Transfer from12-month ECL	(8,158)	6,843	1,315	-
      Transfer from lifetime ECL not credit impaired	20,322	(39,520)	19,198	-
      Transfer from Lifetime ECL credit impaired	7,759	6,110	(13,869)	-
      Net charge for the period	276,220	81,361	288,500	646,081
      Write-offs	-	-	(248,429)	(248,429)
      Balance at the end of the period	805,989	904,460	1,331,193	3,041,642

      8. Loans and advances, net (continued)

   4. The following table shows the stage wise gross loans and advances by product:

      '000	June 30, 2025 (Unaudited)
      	12 month ECL	Lifetime ECL not credit impaired	Lifetime ECL credit impaired	Total
      Overdraft & commercial loans	158,456,199	11,613,270	1,931,913	172,001,382
      Credit Card	782,686	29,016	30,603	842,305
      Consumer	39,950,324	470,062	394,963	40,815,349
      Balance at the end of the period	199,189,209	12,112,348	2,357,479	213,659,036

      '000	December 31, 2024 (Audited)
      	12 month ECL	Lifetime ECL not credit impaired	Lifetime ECL credit impaired	Total
      Overdraft & commercial loans	156,545,338	11,327,349	1,715,954	169,588,641
      Credit Card	696,839	16,488	35,451	748,778
      Consumer	36,620,994	387,293	337,361	37,345,648
      Balance at the end of the year	193,863,171	11,731,130	2,088,766	207,683,067

      '000	June 30, 2024 (Unaudited)
      	12 month ECL	Lifetime ECL not credit impaired	Lifetime ECL credit impaired	Total
      Overdraft & commercial loans	150,068,333	13,065,003	1,580,303	164,713,639
      Credit Card	623,829	47,245	50,789	721,863
      Consumer	33,958,356	487,137	320,713	34,766,206
      Balance at the end of the period	184,650,518	13,599,385	1,951,805	200,201,708

   5. The following table shows the stage wise gross carrying value of loans and advances:

1. Loans and advances, net (continued)

   '000	December 31, 2024 (Audited)
   	12 month ECL	Lifetime ECL not credit impaired	Lifetime ECL credit impaired	Total
   Balance at January 01	167,788,441	12,277,226	1,969,546	182,035,213
   Transfer from12-month ECL	(3,481,080)	3,269,612	211,468	-
   Transfer from lifetime ECL not credit impaired	1,212,596	(1,979,200)	766,604	-
   Transfer from Lifetime ECL credit impaired	24,495	171,293	(195,788)	-
   Net change for the year	28,318,719	(2,007,801)	(245,932)	26,064,986
   Write-offs	-	-	(417,132)	(417,132)
   Balance at the end of the year	193,863,171	11,731,130	2,088,766	207,683,067

   '000	June 30, 2024 (Unaudited)
   	12 month ECL	Lifetime ECL not credit impaired	Lifetime ECL credit impaired	Total
   Balance at January 01	167,788,441	12,277,226	1,969,546	182,035,213
   Transfer from12-month ECL	(2,649,219)	2,519,314	129,905	-
   Transfer from lifetime ECL not credit impaired	979,126	(1,158,603)	179,477	-
   Transfer from Lifetime ECL credit impaired	16,378	11,198	(27,576)	-
   Net change for the period	18,515,792	(49,750)	(51,118)	18,414,924
   Write-offs	-	-	(248,429)	(248,429)
   Balance at the end of the period	184,650,518	13,599,385	1,951,805	200,201,708

2. Due to Saudi Central Bank

   '000	June 30, 2025 (Unaudited)	December 31, 2024 (Audited)	June 30, 2024 (Unaudited)
   Repo	12,928,914	7,984,110	7,475,300
   Deposits	4,566,842	2,367,279	1,526,393
   Government grant	-	2,143,403	2,618,276
   Modification impact, net	-	(2,076)	(36,782)
   Total	17,495,756	12,492,716	11,583,187

3. Due to banks and other financial institutions

   '000	June 30, 2025 (Unaudited)	December 31, 2024 (Audited)	June 30, 2024 (Unaudited)
   Current accounts	493,962	417,407	1,480,182
   Money market placements	7,456,693	8,791,786	2,356,308
   Repos	6,208,355	10,604,950	9,437,091
   Total	14,159,010	19,814,143	13,273,581

4. Derivatives

   In the ordinary course of business, the Bank utilizes the following derivative financial instruments for both trading and hedging purposes:

   1. Swaps

      Swaps are commitments to exchange one set of cash flows for another. For commission rate swaps, counterparties generally exchange fixed and floating rate commission payments in a single currency without exchanging principal. For currency rate swaps, fixed and floating commission payments and principal are exchanged in different currencies.

   2. Forwards and futures

      Forwards and futures are contractual agreements to either buy or sell a specified currency, commodity or financial instrument at a specified price and date in the future. Forwards are customized contracts transacted in the over the counter market. Foreign currency and commission rate futures are transacted in standardized amounts on regulated exchanges and changes in futures contract values are settled daily.

   3. Forward rate agreements

      Forward rate agreements are individually negotiated commission rate contracts that call for a cash settlement for the difference between a contracted commission rate and the market rate on a specified future date, on a notional principal for an agreed period of time.

   4. Options

Options are contractual agreements under which the seller (writer) grants the purchaser (holder) the right, but not the obligation, to either buy or sell at fixed future date or at any time during a specified period, a specified amount of a currency, commodity or financial instrument at a pre-determined price.

Held for trading purposes

Most of the Bank's derivative trading activities relate to sales, positioning and arbitrage. Sales activities involve offering products to customers, Banks and other financial institutions in order, inter alia, to enable them to transfer, modify or reduce current and future risks. Positioning involves managing market risk positions with the expectation of profiting from favorable movements in prices, rates or indices. Arbitrage involves identifying, with the expectation of profiting from price differentials between markets or products. The Bank also holds structured derivatives which are fully back to back in accordance with the Bank's risk management strategy.

1. Derivatives (continued) Held for hedging purposes

   The Bank has adopted a comprehensive system for the measurement and the management of risk. Part of the risk management process involves managing the Bank's exposure to fluctuations in foreign exchange and commission rates to reduce its exposure to currency and commission rate risks to an acceptable level as determined by the Board of Directors in accordance with the guidelines issued by SAMA.

   The Board of Directors has established the levels of currency risk by setting limits on counterparty and currency position exposures. Positions are monitored on a daily basis and hedging strategies are used to ensure positions are maintained within the established limits. The Board of Directors has also established the level of commission rate risk by setting commission rate sensitivity limits. Commission rate exposure in terms of the sensitivity is reviewed on a periodic basis and hedging strategies are used to reduce the exposure within the established limits.

   As part of its asset and liability management the Bank uses derivatives for hedging purposes in order to adjust its own exposure to currency and commission rate risks. This is generally achieved by hedging specific transactions as well as strategic hedging against overall consolidated statement of financial position exposures. Strategic hedging does not qualify for special hedge accounting and the related derivatives are accounted for as held for trading.

   The Bank uses forward foreign exchange contracts and currency rate swaps to hedge against specifically identified currency risks. In addition, the Bank uses commission rate swaps and commission rate futures to hedge against the commission rate risk arising from specifically identified fixed commission rate exposures. The Bank also uses commission rate swaps to hedge against the cash flow risk arising on certain floating rate exposures. In all such cases, the hedging relationship and objective, including details of the hedged items and hedging instrument are formally documented and the transactions are accounted for as fair value or cash flow hedges.

   Cash flow hedges

   The Bank is exposed to variability in future special commission income cash flows on non-trading assets and liabilities which bear variable commission rate. The Bank uses commission rate swaps as cash flow hedges of these commission rate risks. Also, as a result of firm commitments in foreign currencies, such as its issued foreign currency debt, the Bank is exposed to foreign exchange and commission rate risks which are hedged with cross currency commission rate swaps.

   The tables below show the positive and negative fair values of derivative financial instruments held, together with their notional amounts. The notional amounts, which provide an indication of the volumes of the transactions outstanding at the end of the period / year, do not necessarily reflect the amounts of future cash flows involved. These notional amounts, therefore, are neither indicative of the Bank's exposure to credit risk, which is generally limited to the positive fair value of the derivatives, nor to market risk.

   '000	June 30, 2025 (Unaudited)			December 31, 2024 (Audited)			June 30, 2024 (Unaudited)
   	Positive fair value	Negative fair value	Notional amount	Positive fair value	Negative fair value	Notional amount	Positive fair value	Negative fair value	Notional amount
   Held for trading:
   Commission rate swaps	4,192,742	4,278,828	269,096,837	5,199,731	5,372,363	266,091,409	5,834,509	5,623,022	240,811,818
   Commission rate futures and options	65,886	65,886	9,125,682	92,940	92,940	8,815,881	139,041	139,041	11,427,278
   Forward foreign exchange contracts & currency swaps	34,746	43,230	22,175,643	105,016	112,685	20,681,986	71,303	75,196	28,685,146
   Currency options	300	300	130,544	21,930	21,930	1,680,017	1,477	1,477	1,943,367
   Others	27,759	27,759	5,228,821	26,161	26,161	1,486,432	20,950	20,950	729,673
   Held as fair value hedges:
   Commission rate swaps	154,300	128,466	14,793,750	-	137,469	13,575,000	-	309,195	11,000,000
   Held as cash flow hedges:
   Commission rate swaps	291,188	277,555	28,401,500	245,803	454,874	31,238,250	139,995	933,543	32,359,500
   Total	4,766,921	4,822,024	348,952,777	5,691,581	6,218,422	343,568,975	6,207,275	7,102,424	326,956,782

2. Customers' deposits

   '000	June 30, 2025 (Unaudited)	December 31, 2024 (Audited)	June 30, 2024 (Unaudited)
   Demand	80,515,857	80,365,630	78,938,225
   Saving	931,562	976,105	894,849
   Time	95,860,210	98,059,257	111,336,753
   Other	5,382,432	5,717,187	5,077,750
   Total	182,690,061	185,118,179	196,247,577

   Time deposits include Shariah based deposits amounting to

   43,293 million (December 31, 2024:
   48,536 million; June 30, 2024:
   59,999 million).
   
   
3. Debt securities and term loans

During 2022 the Bank has established a USD 4 Billion Euro Medium term Note (MTN) Programme. The issuer under the programme is BSF Finance Limited, operating as a special purpose entity for the guarantor Banque Saudi Fransi. In 2023 the Bank established a USD 4 Billion Trust Certificate Issuance Programme. The issuer under the programme is BSF Sukuk Company, which operates as a special purpose entity for the guarantor Banque Saudi Fransi.

During 2Q 2025 the Bank has established a USD 4 Billion Certificate of Deposit Programme. The issuer under the programme is Banque Saudi Fransi.

Debt Securities and term loans issued by the Bank under its various programs during 2025 include:

1. Debt securities and term loans (continued)

   Issue Date	Type	Market	Tenure	Currency	Value	Term	Maturity
   May 23 2025	Certificate of Deposit	Private placement	3 month	USD	25 Million	Fixed 4.65999%	Aug 22 2025
   May 28 2025	Certificate of Deposit	Private placement	6 month	USD	100 Million	Fixed 4.73%	Nov 26 2025
   May 29 2025	Certificate of Deposit	Private placement	3 month	USD	50 Million	Fixed 4.64%	Sep 02 2025
   Jun 04 2025	Bond	Private placement	7 Years	USD	20 Million	SOFR + 150 bps Quarterly	Jun 04 2032
   Jun 05 2025	Certificate of Deposit	Private placement	6 month	USD	50 Million	Fixed 4.76%	Dec 02 2025
   Jun 11 2025	Certificate of Deposit	Private placement	3 month	USD	249 Million	Fixed 4.65%	Sep 09 2025
   Jun 11 2025	Certificate of Deposit	Private placement	1 Year	USD	82.5 Million	Fixed 4.71%	Jun 10 2026
   Jun 18 2025	Certificate of Deposit	Private placement	3 month	USD	20 Million	Fixed 4.63%	Sep 18 2025
   Jun 23 2025	Certificate of Deposit	Private placement	2 month	USD	200 Million	Fixed 4.55001%	Aug 22 2025
   Jun 27 2025	Certificate of Deposit	Private placement	3 month	USD	150 Million	Fixed 4.67002%	Sep 24 2025

2. Commitments and contingencies

   The Bank's credit related commitments and contingencies are as follows:

   '000	June 30, 2025 (Unaudited)	December 31, 2024 (Audited)	June 30, 2024 (Unaudited)
   Letters of credit	10,022,198	10,914,044	9,878,377
   Letters of guarantee	52,857,781	51,075,695	48,733,873
   Acceptances	2,376,418	3,016,542	2,522,189
   Irrevocable commitments to extend credit	15,115,807	16,878,266	14,780,144
   Total	80,372,204	81,884,547	75,914,583

   1. The following table shows the stage wise movement in ECL allowance for commitments and contingencies:

      '000	June 30, 2025 (Unaudited)
      	12 month ECL	Lifetime ECL not credit impaired	Lifetime ECL credit impaired	Total
      Balance at January 01	50,011	23,836	147,863	221,710
      Transfer from12-month ECL	(213)	209	4	-
      Transfer from lifetime ECL not credit impaired	4,721	(4,723)	2	-
      Net (reversal) / charge for the period	(6,903)	(1,889)	301	(8,491)
      Write-offs	-	-	-	-
      Balance at the end of the period	47,616	17,433	148,170	213,219

      '000	December 31, 2024 (Audited)
      	12 month ECL	Lifetime ECL not credit impaired	Lifetime ECL credit impaired	Total
      Balance at January 01	14,639	6,637	174,825	196,101
      Transfer from 12-month ECL	(404)	404	-	-
      Transfer from lifetime ECL not credit impaired	135	(222)	87	-
      Transfer from lifetime ECL credit impaired	-	-	-	-
      Net charge / (reversal) for the year	35,641	17,017	(27,049)	25,609
      Write-offs	-	-	-	-
      Balance as at December 31, 2024	50,011	23,836	147,863	221,710

      '000	June 30, 2024 (Unaudited)
      	12 month ECL	Lifetime ECL not credit impaired	Lifetime ECL credit impaired	Total
      Balance at January 01	14,639	6,637	174,825	196,101
      Transfer from12-month ECL	(466)	466	-	-
      Transfer from lifetime ECL not credit impaired	218	(218)	-	-
      Net charge / (reversal) for the period	1,285	2,884	(26,966)	(22,797)
      Write-offs	-	-	-	-
      Balance at the end of the period	15,676	9,769	147,859	173,304

      1. Commitments and contingencies (continued)

   2. The following table shows the ECL stages movement in off statement of financial position:

The Group is subject to legal proceedings in the ordinary course of business. There was no material change in the status of legal proceedings filed against the Bank as disclosed at December 31, 2024.

1. Cash and cash equivalents

   Cash and cash equivalents included in the condensed interim consolidated statement of cash flows comprise the following:

   '000	June 30, 2025 (Unaudited)	December 31, 2024 (Audited)	June 30, 2024 (Unaudited)
   Cash and balances with Saudi Central Bank excluding statutory deposit (note 5) Due from banks and other financial institutions maturing within three months from the date of acquisition	1,019,749 3,446,612	983,343 2,046,185	2,060,508 9,473,851
   Total	4,466,361	3,029,528	11,534,359

2. Tier 1 Capital

   During 2020, the Bank through a Shariah compliant arrangement issued Tier 1 Sukuk (the "Sukuk"), amounting to

   5 billion. The issuance was approved by the regulatory authorities and the Board of Directors of the Bank. The applicable profit rate is 4.5% per annum from date of issue up to 2025 and is subjected to reset every 5 years.
   
   

   During Q3 2024, the Bank through a Shariah compliant arrangement issued Tier 1 Sukuk (the "Sukuk"), amounting to

   3 billion under its
   8 billion Tier 1 Sukuk Programme established in Q1 2024. The issuance was approved by the regulatory authorities and the Board of Directors of the Bank. The applicable profit rate is 6.0% per annum from date of issue up to 2029 and is subjected to reset every 5 years.
   
   

   The applicable profit on the Sukuk is payable quarterly in arrears on each periodic distribution date, except upon the occurrence of a non-payment event or non-payment election by the Bank, whereby the Bank may at its sole discretion (subject to certain terms and conditions) elect not to make any distributions. Such non-payment event or non-payment election are not considered to be events of default and the amounts not paid thereof shall not be cumulative or compound with any future distributions.

   During Q2 2025, the Bank issued USD 650 million Additional Tier 1 Capital as part of its USD 3 Billion Additional Tier 1 Capital Note Programme established in Q3 2024, the issuer under the programme is Banque Saudi Fransi. The applicable profit rate is 6.375% per annum from date of issue up to 2030.

3. Zakat

   Zakat, Tax and Customs Authority ("ZATCA") issued new zakat regulations through Ministerial Decree No. 2215 dated Rajab 07, 1440H corresponding to March 14, 2019, which provides the new basis for the calculation of Zakat for companies engaged in financing activities and licensed by SAMA. The Bank has calculated zakat in accordance with the above regulation.

   The Bank submitted its zakat return for the year ended December 31 2024, and obtained the unrestricted zakat certificate. The assessments in respect to the Bank's zakat returns for the financial year up to 2020 have been finalized. The assessments for the financial years 2021 to 2024 have not been finalized with ZATCA.

   Zakat for the period ended June 30, 2025 amounted to approximately

   320 million (June 30, 2024:
   263 million). The provision of Zakat is estimated based on the results of operations of the Bank for the six months period ended and the consolidated financial position at June 30, 2025.
   
   
4. Fair values of financial assets and liabilities

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either in the principal market for the asset or liability, or in the absence of a principal market, in the most advantageous market for the asset or liability.

For financial instruments that trade infrequently and have little price transparency, fair value is less objective, and requires varying degrees of judgment depending on liquidity, concentration, uncertainty of market factors, pricing assumptions and other risks affecting the specific instrument.

Valuation models

Valuation techniques include net present value and discounted cash flow models, comparison with similar instruments for which market observable prices exist. Assumptions and inputs used in valuation techniques include risk-free and benchmark interest rates, credit spreads and other premium used in estimating discount rates, bond and equity prices and foreign currency exchange rates.

The objective of valuation techniques is to arrive at a fair value measurement that reflects the price that would be received to sell the asset or paid to transfer the liability in an orderly transaction between market participants at the measurement date. The Bank uses widely recognized valuation models for determining the fair value of common and simpler financial instruments.

Observable prices or model inputs are usually available in the market for listed debt and equity securities, exchange-traded derivatives and simple over-the-counter derivatives such as interest rate swaps. Availability of observable market prices and model inputs reduces the need for management judgment and estimation and also reduces the uncertainty associated with determining fair values. Availability of observable market prices and inputs varies depending on the products and markets and is prone to changes based on specific events and general conditions in the financial markets.

Valuation models that employ significant unobservable inputs require a higher degree of management judgment and estimation in the determination of fair value. Management judgment and estimation are usually required for selection of the appropriate valuation model to be used, determination of expected future cash flows on the financial instrument being valued, determination of the probability of counterparty default and prepayments and selection of appropriate discount rates. Fair value estimates obtained from models are adjusted for any other factors, such as liquidity risk or model uncertainties; to the extent that the Bank believes that a third party market participant would take them into account in pricing a transaction. Fair values aim also to reflect the credit risk of the instrument and include adjustments to take account of the credit risk of the Bank and the counterparty where appropriate.

Valuation Framework

The Bank has an established control framework with respect to the measurement of fair values. This framework includes a Market Risk Department, which is independent of Front Office management and reports to the Chief Risk Officer, and which has overall responsibility for independently verifying the results of trading and investment operations and all significant fair value measurements.

Determination of fair value and fair value hierarchy

The Bank uses the following hierarchy for determining and disclosing the fair value of financial instruments: Level 1: Quoted prices in active markets for the same instrument (i.e. without modification or repackaging)

Level 2: Quoted prices in active markets for similar assets and liabilities or other valuation techniques for which all significant inputs are based on observable market data: and

Level 3: Valuation techniques for which any significant input is not based on observable market data.

18. Fair values of financial assets and liabilities (continued)

Derivative products valued using a valuation technique with market observable inputs are mainly commission rate swaps and options, currency swaps and forward foreign exchange contracts. The most frequently applied valuation techniques include forward pricing and swap models, using present value calculations. The models incorporate various inputs including foreign exchange spot and forward rates and commission rate curves. Other investments in level 2 are valued based on market observable date including broker rates etc.

During the period there have been no transfers in between level 1, level 2 and level 3.

1. Fair values of financial assets and liabilities (continued)

   The fair values of investments held at amortized cost are

   27,411 million (December 31, 2024:
   26,098 million and June 30, 2024:
   26,664 million) against carrying value of
   27,988 million (December 31, 2024:
   27,678 million and June 30, 2024:
   27,713 million).The fair values of commission bearing customers' deposits, debt securities, due from and due to banks and other financial institutions which are carried at amortized cost, are not significantly different from the carrying values included in the condensed interim consolidated financial statements, since the current market commission rates for similar financial instruments are not significantly different from the contracted rates, and due to the short duration of due from and due to banks and other financial institutions. An active market for these instruments is not available and the Bank intends to realize the carrying value of these financial instruments through settlement with the counter party at the time of their respective maturities.
   
   

   The estimated fair values of investments held at amortized cost are based on quoted market prices when available or pricing models when used in the case of certain fixed rate bonds. Consequently, differences can arise between carrying values and fair value estimates. The fair values of derivatives are based on the quoted market prices when available or by using the appropriate valuation technique. The Bank uses the discounted cash flow method using current yield curve to arrive at the fair value of loans and advances after adjusting internal credit spread which is

   
   
   
   
   
   
   211,509 million (December 31, 2024: 205,276 million and June 30, 2024: 197,265 million). The carrying values of those loans and advances are 209,881 million (December 31, 2024: 204,168 million and June 30, 2024:
   197,160 million).
   
   

   The following table shows a reconciliation from the beginning balances to the ending balances for the fair value measurements in Level 3 of the fair value hierarchy:

   '000	June 30, 2025 (Unaudited)	December 31, 2024 (Audited)	June 30, 2024 (Unaudited)
   Balance at the beginning of the period / year	299,679	210,417	210,417
   Additions during the period / year	44,095	107,503	23,249
   Disposal during the period / year	-	(9,000)	-
   Change in value	122,962	(9,241)	6,421
   Balance at the end of period / year	466,736	299,679	240,087

2. Segment information

Operating segments are identified on the basis of internal reports about components of the Bank that are regularly reviewed by the Bank's Board of Directors in its function as chief decision maker in order to allocate resources to the segments and to assess its performance.

Transactions between operating segments are approved by the management as per agreed terms and are reported according to the Bank's internal transfer pricing policy. These terms are in line with normal commercial terms and conditions. The revenue from external parties report to the Board is measured in a manner consistent with that in the condensed interim consolidated statement of income.

Bank has adopted new FTP methodology from the beginning of 2025 to derive inter-segment revenues which is reflected in the segment profit or loss as of June 30, 2025.