Sustained Profit Growth and Dividend Policy Boost Riyad Bank's Attractiveness in 2025

Riyad Bank concluded 2025 with a resilient financial performance, combining profit growth, balance sheet expansion, and improved income quality. The bank recommended a substantial cash dividend for the second half of the year, signaling a prudent balance between capital reinforcement and maximizing shareholder returns.

Net profit attributable to shareholders reached SAR 10.41 billion in 2025, marking an 11.7% annual increase, driven by higher total operating income and reduced credit loss provisions. Pre-zakat and tax profit rose to SAR 11.61 billion, while total comprehensive income attributable to shareholders stood at SAR 11.08 billion, underlining operational strength.

Core income saw notable growth, with special commission income from financing rising to SAR 24.16 billion amid increased lending activity. Commission income from investments climbed to SAR 2.93 billion. Net commission income from financing reached SAR 12.09 billion, while net commission income from investments eased to SAR 0.98 billion due to changes in investment returns structure.

Total operating income hit SAR 18.38 billion, supported by higher fee and commission income, trading income, and gains from the sale of non-trading investments, partially offset by lower FX income and dividends.

The balance sheet continued to expand, with total assets rising to SAR 519.5 billion (up 15.1%), driven by loan portfolio growth to SAR 373.3 billion and investments to SAR 79.5 billion. Customer deposits reached SAR 331.7 billion, reflecting stable funding.

Operating expenses before provisions were SAR 5.43 billion, with limited growth. Net expected credit loss provisions fell to SAR 1.37 billion (down 15.8%), directly enhancing profitability. Equity increased to SAR 64.1 billion (up 8.6%), and earnings per share reached SAR 3.29.

The board recommended a SAR 1.64 billion cash dividend for H2 2025 (SAR 0.55 per share, 5.5% of nominal value), subject to Saudi Central Bank approval. Eligibility is for shareholders at the end of the general assembly trading day, with the payment date to be announced.

EcoPulse24 Analysis: Riyad Bank's strong financial results and attractive dividend proposal position it comfortably within Saudi Arabia's banking sector. Profit growth, fueled by credit expansion and lower provisions, indicates improved asset quality and risk management. The balanced dividend policy demonstrates capital discipline, enhancing the stock's appeal to income-focused investors. Sustaining this trajectory into 2026 will depend on maintaining lending momentum and credit quality, leveraging a stable deposit base and proven operational capability.