Lenders extended their domestic influence through growing claims on businesses, households and state institutions. Outstanding credit soared to SAR 3.13 trillion by month‑end—an expansion of 16.5 per cent compared with April 2024, making it the sharpest annual increase since mid‑2021. Within this, corporate lending led the way, climbing 22 per cent to SAR 1.72 trillion, underscoring the pivotal role of private‑sector credit in driving growth.
Loans to the private sector alone surpassed SAR 3 trillion—standing at SAR 3.01 trillion by the end of April—a 15 per cent increase from April 2024. Meanwhile, lending to non‑financial government entities reached SAR 218.2 billion, reflecting a 38 per cent surge year‑on‑year. Across both segments, aggregate loans hit SAR 3.23 trillion, up 17 per cent from SAR 2.77 trillion in April 2024.
Investment in government securities added further impetus. Saudi banks’ holdings of treasury bonds rose to SAR 617 billion in April 2025, up SAR 4.5 billion from the previous month. These instruments now account for about 74 per cent of banks’ claims on public and quasi‑public entities.
Sound profits and robust liquidity remain a hallmark of the sector. Commercial lenders achieved pre‑zakat and tax profits of SAR 7.77 billion in April—a 16 per cent increase compared to April 2024—raising first four‑month profits by 20 per cent to SAR 32.97 billion. SAMA’s statistics confirm that financing volumes are swelling, supported by public infrastructure investment, resilient consumer demand, and elevated interest rates.
The surge in liquidity across the economy continues to bolster bank performance. By February, broad money supply reached a record SAR 3.03 trillion—up 10 per cent year‑on‑year—anchored in demand, time and quasi‑cash deposits. The expanding deposit base provides banks with ample funds to fuel lending and investment growth.
Global rankings speak to the strength of Saudi banks. Forbes Middle East’s 2025 list of the “30 Most Valuable Banks” includes ten Saudi institutions with combined market capitalisation around $269 billion. Al Rajhi Bank leads with $105.6 billion, trailed by Saudi National Bank at $54.7 billion. International recognition has also followed, with Global Finance naming Saudi Awwal Bank as the Kingdom’s best lender in the Middle East for 2025.
The consistency of growth reflects a broader economic strategy aimed at supporting giga‑projects like NEOM, Diriyah and Jafurah gas field development. Contractors and corporate borrowers are increasing long‑term credit offtake to fund these initiatives. At the same time, banks are streamlining their balance sheets through the sale of older non‑performing loans and tapping capital markets; issuance of Additional Tier‑1 bonds reached over $5.6 billion by June—marking a full‑year record and the second‑largest global issuance for AT1 in 2025.
Sector watchers expect the current momentum to continue. Riyad Capital forecasts a double‑digit profit climb for listed banks in 2025, driven by persistent loan growth and slowly easing interest margins. S\&P Global projects further lending increases—about 10 per cent—might compensate for any margin contraction of 20 to 30 basis points, sustaining asset‑return ratios near 2.1–2.2 per cent.
The sector has also tightened its risk profile. Argaam reports that non‑performing‑loan ratios dropped to historic lows in 2024, amid high capital adequacy—Basel‑standard buffers above 20 per cent. SAMA’s latest data confirm that impairments continued to fall into Q2 2024, reinforcing sound asset quality. Deposit growth, while solid, remains well‑aligned with lending increases—evidenced by a loan‑to‑deposit ratio climbing above 90 per cent, indicating efficient use of funding.
Commercial banks’ balance‑sheet strength is also reflected in foreign exchange buffers. SAMA’s reserves stood at approximately SAR 1.92 trillion by April 2025, underscoring market confidence.
Unlike some regional peers, Saudi banks are seeing double‑digit growth in their credit portfolios. Kamco Invest’s Q2‑2024 analysis recorded a 3.1 per cent quarterly rise in credit facilities, leading among GCC states. Meanwhile, net interest income for GCC‑listed banks, including those in Saudi, hit record highs in Q2 2024—driven by elevated interest environments.
Concentration remains a feature of the market. According to IMF data, the two largest banks held nearly half of the system’s assets by end‑2023, with the top five accounting for 74 per cent. Total banking assets approached 99 per cent of GDP by end‑2023, up from 88 per cent in 2017, signalling both the sector’s scale and influence in the national economy.
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