Strong customer franchise in the retail sector, Superior and sustained profitability, Concentration risks in loans and deposits that are lower than peers', and Solid capitalization. Vulnerability to shocks in domestic real estate and capital markets, Limited business and geographic diversification, and Increasing competitive pressure. The ratings on Saudi Arabia-based Al Rajhi Banking & Investment Corp. (Al Rajhi) reflect the bank's healthy customer franchise in the retail sector, excellent profitability, concentrations in loans and deposits that are lower than peers', and strong capitalization. The ratings are constrained by limited business and geographic diversification, increasing loan leverage and competition, and the bank's vulnerability to shocks in real estate and capital markets. In terms of assets, Al Rajhi is the third-largest Saudi bank.
