Saudi Arabia
Banking sector profile — Middle East & North Africa
Data as of October 2026 • TGB Intelligence Unit
Policy rate as of 7 October 2026: 4.50% (source: Saudi Central Bank (SAMA))
Banking sector at a glance
Structure and performance
Saudi Arabia's banking system held SAR4.83tn (US$1.29tn) of assets at end-2025, roughly equal to annual GDP. It is concentrated: Saudi National Bank and Al Rajhi Bank reported consolidated assets of US$322.7bn and US$278.2bn, equivalent to about 47% of sector assets, followed by Riyad Bank and SAB. Islamic banks such as Al Rajhi Bank and Alinma Bank compete with conventional banks that also offer Sharia-compliant products. Lending is predominantly domestic and private-sector: banks' claims on the private sector reached SAR3.12tn in February 2026.
Funding is the sector's main constraint. Customer deposits equalled 94.6% of non-interbank loans at end-2025, and banks have increasingly borrowed abroad: liabilities to non-residents rose to SAR661.9bn in February 2026 from SAR622.8bn at end-2025, and net foreign assets fell to minus SAR230.8bn. Liquidity metrics remain comfortably above minima, with a liquidity coverage ratio of 173% and an NSFR of 113% at end-2025. Residential real estate loans made up 21.5% of total loans, reflecting the growth of mortgage lending over recent years.
Capital, asset quality and profitability are strong. At end-2025 the total capital ratio was 20.5%, Tier 1 18.8% and CET1 15.7%, and the NPL ratio 1.0%. Return on equity was 15.0% and return on assets 2.3%. Al Rajhi Bank reported 2025 net income of about SAR24.8bn, up 26%, with return on shareholders' equity of 23.4%.
The main risks are funding and interest rates. Rising reliance on non-resident funding and the size of the mortgage book increase sensitivity to liquidity conditions, while the riyal's dollar peg transmits US rate moves; SAMA raised policy rates on 16 September 2026, the same day the Federal Reserve raised its target range.
Structural trends
The shifts shaping banking in Saudi Arabia.
Banks' net foreign assets fell to minus SAR230.8bn in February 2026 from minus SAR204.8bn at end-2025 as borrowing from non-residents grew.
Residential real estate loans accounted for 21.5% of total bank loans at end-2025, making mortgages a core part of bank balance sheets.
SAMA began licensing fintech companies to provide open banking services on 26 March 2026, after the regulatory sandbox phase, and licensed its first two providers, including Lean Technologies, the same day.
Profitability remains high: sector ROE was 15.0% in 2025, and Al Rajhi Bank reported return on shareholders' equity of 23.4% for 2025.
Leading institutions
Largest banks in Saudi Arabia by total assets.
| # | Bank | Total assets (US$) | Type |
|---|---|---|---|
| 1 | Saudi National Bank | US$322.7bn | Commercial |
| 2 | Al Rajhi Bank | US$278.2bn | Islamic |
| 3 | Riyad Bank | US$138.5bn | Commercial |
| 4 | Saudi Awwal Bank (SAB) | US$121.2bn | Commercial |
| 5 | Alinma Bank | US$83.0bn | Islamic |
| 6 | Banque Saudi Fransi | US$82.4bn | Commercial |
| 7 | Arab National Bank | US$75.0bn | Commercial |
| 8 | Bank Albilad | US$46.1bn | Islamic |
Largest banks in Saudi Arabia by total assets, FY2025 audited accounts. Domestic groups as in the TGB Bank Rankings; other domestic banks from their own audited accounts; subsidiaries of foreign groups shown with their own accounts and marked. Not a ranking table. Converted at official central-bank rates for each fiscal year-end.
Supervision and capital rules
SAMA is the central bank and the prudential and conduct supervisor of banks, finance companies and payment providers; the Capital Market Authority regulates securities business, including banks' brokerage and asset-management subsidiaries. Banks calculate capital under SAMA's implementation of the final Basel III reforms, which Saudi National Bank reports as the standardised approach of the 'Basel IV' final reforms; the sector's total capital ratio averaged 20.5% at end-2025. Liquidity is governed by LCR and NSFR standards. Retail lending is subject to responsible-financing rules, including debt-burden ratio limits. In March 2026 SAMA moved open banking from its regulatory sandbox to a formal licensing regime.
What changed in 2026
- March 2026: SAMA began licensing open banking providers on 26 March and licensed its first two companies, including Lean Technologies, the same day.
- September 2026: SAMA raised the repo rate by 25bp to 4.50% and the reverse repo rate to 4.00% on 16 September, following the Federal Reserve.
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