Fitch affirms Saudi Arabia's Al Rajhi Banking & Investment Corporation at 'A'/ 'F1'; Outlook Positive

The IDRs, Support rating and Support Rating Floor reflect the extremely high probability of support from the Saudi authorities, should the need arise. This is based on the strong history of support from the Saudi Arabian Monetary Agency and the bank's strong domestic franchise.

Al Rajhi dominates the Islamic market segment in Saudi Arabia and has a market share in retail banking of around 28%. The Positive Outlook for the bank's Long-term IDR reflects Fitch's Outlook for the sovereign rating ('A+'). The bank's Long-term IDR is unlikely to change unless the sovereign rating changes. The Individual rating reflects the bank's domestic franchise, sound asset quality and capital, strong margins and profitability, assisted by its low cost customer funding, but also its significant loan growth and concentration in the retail sector.

Al Rajhi was established in 1988, although its roots as a money changer date back to the 1940s. The main shareholders are members of the Al Rajhi family, who hold around 46% of the shares and comprise most of the members of the board. Local investors hold around 44% and the government holds 10%. The bank has the largest branch network in Saudi Arabia with a network of over 500 branches and remittance centres, and over 1,900 ATMs. The bank established a subsidiary in Malaysia, focusing on Islamic retail banking, in late 2006.