Published by MBA Skool Team, Last Updated: April 26, 2020
SWOT analysis of Al Rajhi Bank analyses the brand by its strengths, weaknesses, opportunities & threats. In Al Rajhi Bank SWOT Analysis, the strengths and weaknesses are the internal factors whereas opportunities and threats are the external factors.
SWOT Analysis is a proven management framework which enables a brand like Al Rajhi Bank to benchmark its business & performance as compared to the competitors. Al Rajhi Bank is one of the leading brands in the banking & financial services sector.
The table below lists the Al Rajhi Bank SWOT (Strengths, Weaknesses, Opportunities, Threats), top Al Rajhi Bank competitors and includes its target market, segmentation, positioning & Unique Selling Proposition (USP).
Al Rajhi Bank SWOT Analysis, Competitors, Segmentation, Target Market, Positioning, USP & Brand Analysis Table
Saudi Arabia’s largest sharia-compliant banking group offering sharia-compliant products
Al Rajhi Bank STP
Retail banking, corporate banking, treasury banking and investment and brokerage services
Individuals, Small, medium & large enterprise looking for diverse financial solutions
Saudi Arabia’s largest sharia-compliant banking group, instrumental in bridging the gap between modern financial demands and intrinsic values
SWOT Analysis of Al Rajhi Bank
Al Rajhi Bank Strengths
Below are the Strengths in the SWOT Analysis of Al Rajhi Bank:
1. It is one of the largest Islamic Bank of the World with total asset of USD 60 Billion 2. 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
3. The bank has also expanded into Malaysia, the world’s Islamic finance hub, as well as Kuwait and Jordan
4. It won the Asian banker of the year for Retail and Corporate Banking
5. It has the largest retail network and occupies nearly half of the retail sector’s profits and has over 7500 employees
6. 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
Al Rajhi Bank Weaknesses
Here are the weaknesses in the Al Rajhi Bank SWOT Analysis:
1. The bank had been accused of being involved in funding illegal activities by a US Senate committee, thrashing its reputation 2. Rapid credit growth exerted excessive pressure on Al Rajhi's capital position 3. Given the limited use of variable components in compensation, costs tend to be sticky and of low flexibility across the cycle
Al Rajhi Bank Opportunities
Following are the Opportunities in Al Rajhi Bank SWOT Analysis:
1. Strong net profit growth on the back of a surging economy, fuelled by high oil prices, which has boosted lending, deposits and deal activity
2. Bank sector lending to private companies in Saudi Arabia still grew at a rate of 15 percent year-on-year 3. Increased retail lending can be a key driver of the Al Rajhi's overall loan growth
4. International expansion likely to bolster revenues, the bank should try to expand its presence in overseas markets
Al Rajhi Bank Threats
The threats in the SWOT Analysis of Al Rajhi Bank are as mentioned:
1. In the past quarters, the competition has increased significantly from both Islamic and conventional players 2. If the bank's reputation were to be damaged on account of allegations made by US Senate, it can lower down its ratings
3. 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
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