Saudi Awwal Bank (1060) investor relations material

Executive summary

• Net income for H1 2026 reached SAR 4,417 million, up 4% year-over-year, with strong loan growth of 13% YoY and resilient asset quality despite regional uncertainties.

• Loan growth was balanced between corporate and retail, with corporate driven by large institutional clients and retail by mortgages; the bank maintained a leading position in Vision 2030 giga-programmes.

• Fee income rebounded 40–43% quarter-on-quarter in Q2, supported by efficiencies in credit card programs and trade-related fees.

• Maintained prudent liquidity, strong capital adequacy, and increased loan loss coverage, with SAR 100 million reversed in Q2 as conditions improved.

• Investments in technology and AI are expected to drive future productivity gains.

Financial highlights

• Net income for H1 2026 was SAR 4,417 million, up from SAR 4,262 million year-over-year; Q2 net income was up 12% sequentially and 10% YoY.

• Net special commission income for H1 2026 was SAR 5,820 million, up from SAR 5,766 million year-over-year; NIM stable at 2.53%.

• Gross loans grew 13% YoY to SAR 327.6 billion, and customer deposits rose 15% YoY to SAR 342.2 billion.

• Cost efficiency ratio was 30.4%, slightly above plan, and cost of risk was 11 bps, ahead of guidance.

• Basic and diluted EPS for H1 2026 was SAR 1.96, compared to SAR 1.95 in H1 2025.

Outlook and guidance

• Loan growth guidance remains above 10%, with NIM expected between 2.5% and 2.6% and cost efficiency ratio below 29.5%.

• CET1 ratio expected to remain above 14%, with cost of risk guidance at 25–35 bps.

• Management remains vigilant of geopolitical risks and continues to stress test the financing portfolio.

• Further fee rebounds and repricing could offset downside risks; cost of risk guidance unchanged, with potential for further overlay reversals.

• No changes to full-year RoTE guidance, but both upside and downside risks exist.