Al Rajhi Bank SWOT Analysis
Here is a detailed SWOT analysis of Al Rajhi Bank covering strengths, weaknesses, opportunities and threats.
Al Rajhi Bank Strengths
- It is one of the largest Islamic Bank of the World with total asset of USD 60 Billion
- Al Rajhi is one of best-known family businesses with nearly 600 branches across the oil-rich kingdom, a sixth of which are dedicated to female customers in the gender-segregated society
- The bank has also expanded into Malaysia, the world’s Islamic finance hub, as well as Kuwait and Jordan
- It won the Asian banker of the year for Retail and Corporate Banking
- It has the largest retail network and occupies nearly half of the retail sector’s profits and has over 7500 employees
- The bank’s cheap cost of funds, which is a consequence of its large interest-free deposit base, has given it a place among the most attractive Saudi stocks
Above are the strengths in the SWOT Analysis of Al Rajhi Bank. The strengths of Al Rajhi Bank looks at the key internal factors of its business which gives it competitive advantage in the market and strengthens its position.
Al Rajhi Bank Weaknesses
- The bank had been accused of being involved in funding illegal activities by a US Senate committee, thrashing its reputation
- Rapid credit growth exerted excessive pressure on Al Rajhi's capital position
- Given the limited use of variable components in compensation, costs tend to be sticky and of low flexibility across the cycle
These were the weaknesses in the Al Rajhi Bank SWOT Analysis. The weaknesses of a brand are certain aspects of its business which it can improve.
Al Rajhi Bank Opportunities
- Strong net profit growth on the back of a surging economy, fuelled by high oil prices, which has boosted lending, deposits and deal activity
- Bank sector lending to private companies in Saudi Arabia still grew at a rate of 15 percent year-on-year
- Increased retail lending can be a key driver of the Al Rajhi's overall loan growth
- International expansion likely to bolster revenues, the bank should try to expand its presence in overseas markets
Above we covered the opportunities in Al Rajhi Bank SWOT Analysis. The opportunities for any brand can include prospects of future growth.
Al Rajhi Bank Threats
- In the past quarters, the competition has increased significantly from both Islamic and conventional players
- If the bank's reputation were to be damaged on account of allegations made by US Senate, it can lower down its ratings
- The lending environment in Saudi Arabia intensely competitive between a small number of local banks, and means that while banks will be able to book new assets, margins will be tight
The threats in the SWOT Analysis of Al Rajhi Bank are as mentioned above. The threats for any business can be external factors which can negatively impact its business.
Hence this concludes the Al Rajhi Bank SWOT analysis.
About Al Rajhi Bank
The table below gives the brand overview along with its target market, segmentation, positioning & USP
| Al Rajhi Bank Overview | |
|---|---|
| Parent Company |
Al Rajhi Bank |
| Category |
Regional Banks |
| Sector | |
| Tagline/ Slogan |
Local vision, international expertise |
| USP |
Saudi Arabia’s largest sharia-compliant banking group offering sharia-compliant products |
| Al Rajhi Bank STP | |
| Segmentation |
Retail banking, corporate banking, treasury banking and investment and brokerage services |
| Target Market |
Individuals, Small, medium & large enterprise looking for diverse financial solutions |
| Positioning |
Saudi Arabia’s largest sharia-compliant banking group, instrumental in bridging the gap between modern financial demands and intrinsic values |
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