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1030

Governance: D

SAIB

Saudi Investment Bank

13.40 SAR / Share

As of: May 28, 2026

6.8x P/E Ratio Trailing 12 Months

0.7x P/B Ratio Price to Book Value

3.0% Dividend Yield Annual Dividend / Share

16.73B SAR Market Cap Total Valuation

0.85 Beta Systematic Risk Index

51.0% Net Margin Net Profit / Revenue

The Story

SAIB operates as a highly specialized corporate-centric lender in Saudi Arabia, leveraging a robust capital base and structured treasury operations to deliver steady returns.

Source: Q1 2026 (2026-04-30)

Value Creation +2.7% Excess Return on Capital (Spread between ROIC/ROE and Cost of Capital)

Cash Flow Payback — Estimated years of operating cash flows required to cover Enterprise Value

Performance & Distributions

Dividend Yield Trailing annual dividends paid relative to share price

3.0%

Sustainable Growth Rate Rate at which company can grow internally using reinvested profits

+2.1%

Payout Ratio Percent of net profits distributed as dividends

20.4%

Net Margin Net profit margin generated from total operational revenue

51.0%

ROE Return on Equity

10.7%

Market Pricing Multiples

P/E Ratio Market value compared to corporate net earnings

6.8x

P/B Ratio Market capitalization compared to corporate book value

0.7x

NIM Operating multiple reflecting core operational leverage

2.0%

Cost to Income Asset pricing multiple relative to total topline revenue

42.8%

Growth Story

SAIB's growth trajectory is anchored in its corporate lending franchise, with net loans reaching SAR 115.6B, heavily dominated by commercial loans of SAR 105.6B (including SAR 73.7B in corporate loans and SAR 10.5B in MSME loans). This credit expansion has fueled a Net Interest Income (NII) of SAR 3.5B. While retail loans remain a smaller segment at SAR 12.1B, the bank's overall asset base has expanded to SAR 180.3B. This growth is supported by customer deposits of SAR 122.9B, which grew significantly, led by Murabaha commodity deposits of SAR 50.5B and conventional time deposits of SAR 40.3B. However, with a payout ratio of 20.40% and an ROE of 10.72%, the bank's sustainable growth rate is moderated at 2.08%, indicating that while credit demand remains healthy, capital retention and asset deployment must be carefully balanced to support long-term expansion.

Profitability Dynamics

SAIB's profitability is characterized by disciplined cost management and structured spread optimization, yielding a Net Income of SAR 2.4B. The bank operates with a Net Interest Margin (NIM) of 1.96%, reflecting the competitive pricing environment in the corporate lending sector and a deposit base that is heavily weighted toward commission-bearing time deposits. Despite these spread pressures, SAIB maintains strong operational efficiency, as evidenced by a Cost-to-Income ratio of 42.81%. This cost discipline, combined with an ROA of 1.36%, has enabled the bank to generate an ROE of 10.72%. This return comfortably exceeds its estimated Cost of Equity (Ke) of 8.01% (derived from a Beta of 0.8510), demonstrating positive economic value creation and strong operational leverage.

Risk & Capital Structure

Beta Systematic market risk indicator relative to the TASI index

0.85

Cost of Equity Minimum required rate of return demanded by shareholders

8.0%

Loan-to-Deposit Ratio (LDR) Ratio of customer loans relative to deposited reserves

94.0%

CASA Ratio Demand deposit balances as a percentage of total reserves

20.2%

ECL Coverage Credit loss provisioning coverage relative to gross lending assets

1.9%

Capital Adequacy Ratio (CAR) Risk-weighted asset coverage capital backing ratio

—

Non-Performing Loans (NPL) Ratio Percent of gross lending assets classified as non-performing

—

Risk Factors

SAIB maintains a highly conservative risk profile, supported by robust capital buffers and stable asset quality. The bank's non-performing loan (NPL) ratio stands at a low 0.94%, with an NPL coverage ratio of 87.51% and an ECL coverage of 1.86%, backed by TTM provisions of SAR 351M. Capital adequacy remains a key strength, with a Total Capital Adequacy Ratio of 18.90% and a CET1 ratio of 14.07%, both comfortably exceeding SAMA's regulatory minimums. Funding stability is managed through customer deposits of SAR 122.9B, though the bank's Loan-to-Deposit Ratio (LDR) of 94.04% indicates a relatively tight liquidity profile. Furthermore, the bank faces unique geopolitical risks in the Middle East, which deteriorated after February 28, 2026, prompting management to update macroeconomic factors in its ECL models. Additionally, the bank's risk profile is influenced by SAR 28.4B of debt securities pledged under repurchase agreements and a massive derivatives portfolio with a notional amount of SAR 74.7B, though mitigated by netting and collateral agreements.

Governance Disclosures

Rating: D

We track 19 key governance and oversight matters for this company in our database.

Significance: 5/10 Tunneling

Related-Party Transactions with Management

Loans and advances to the management of the Bank and/or their affiliates totaled SAR 328.4 million as of March 31, 2026, down from SAR 362.4 million as of December 31, 2025. Customers' deposits from management were SAR 663.4 million. Remuneration for the Board of Directors and other Board Committee members was SAR 4.67 million for the three-month period ended March 31, 2026.

Mitigating Factors: All related party transactions are conducted on terms approved by the management.

Significance: 5/10 Entrenchment

Discretionary Terms of Tier I Sukuk Program

The bank has SAR 5.31 billion in outstanding Tier I Sukuk tranches which are perpetual and subordinated. The terms allow the bank to elect, at its sole discretion, not to make periodic profit distributions without triggering a default.

Mitigating Factors: The program was approved by the Bank’s regulatory authorities and tranches are offered to eligible investors.

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In-Depth Analysis