The ratings on Saudi Arabia-based Al Rajhi Bank reflect the bank's healthy customer franchise in the retail sector, superior profitability, concentrations in loans and deposits that are lower than peers', and solid capitalization. The ratings are constrained by limited business and geographic diversification, as well as increasing loan leverage and competition. In terms of assets, Al Rajhi is the third-largest bank in the Kingdom of Saudi Arabia (AA-/Stable/A-1+). With the most extensive branch network in the kingdom (in excess of 390 branches), the bank has been able to build up the widest demand deposit base. Given its size and retail entrenchment, Standard&Poor's Ratings Services considers Al Rajhi to be systemically important to the Saudi banking authorities. As such,
