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Al Rajhi Banking and Investment Corporation
Al Rajhi Bank is a Saudi Islamic bank that takes deposits and lends money to people and businesses without charging interest, earning its profit through Islamic finance instead.
Al Rajhi Bank is the giant of Saudi retail banking. Ordinary Saudis use it for the everyday stuff of money: a salary account, a debit card, a car loan, or a mortgage. Small businesses and big corporations bank with it too, and it runs investment and treasury operations that reach beyond the Kingdom. What makes it unusual is that it is an Islamic bank, so it does not charge or pay interest in the conventional sense. Instead it earns profit through structures the religion permits — like buying a house or a car itself and reselling it to the customer on instalments at a markup, or sharing profit and loss with depositors. That structure is not a niche in Saudi Arabia; it is the mainstream.
The bank's home market is the source of most of its strength. Saudi Arabia has a young, fast-growing population, and the government has spent heavily on housing and mega-projects, which creates steady demand for mortgages and business credit. Al Rajhi's branch network and its reputation as a strictly Sharia-compliant institution, built over decades by the Al Rajhi family, give it a customer base that is hard for rivals to peel away. Competitors like Alinma Bank and Saudi National Bank fight for the same customers, but Al Rajhi has long been the retail leader. Its main risk is concentration: it is deeply tied to one economy and to the Saudi property and consumer cycle. Outside Saudi Arabia, the bank runs operations in places like Jordan, Kuwait, and Malaysia, though these are a small slice of the whole. For years it has also built up its digital channels, letting customers do most of their banking on a phone rather than in a branch. That matters because Saudi banking is shifting fast toward mobile, and a cheaper digital operation protects the bank's profit margins as competition on price intensifies.
The money the bank makes is used in the ordinary way a well-run lender uses it. A large share goes out to shareholders as dividends, and the rest is retained to fund loan growth and keep its capital ratios comfortably above regulatory requirements. Because lending is its core, the bank is always balancing growth against the risk that borrowers stop paying when the economy slows. Its long record of low bad loans and high profitability has made it one of the most valuable banks in the Middle East.
Saved answer · last researched 12 Nov 2026