Saudi Arabia's first-quarter GDP grows by 3.4 percent, beating flash estimates
Saudi Arabia's economy grew by more than expected in the first quarter of 2025, according to government data estimates, with lower oil prices impacting the economy less than previously forecast.
First-quarter GDP grew by 3.4 percent compared to the same quarter of the previous year, beating flash estimates of 2.7 percent released in May by the Saudi General Authority for Statistics.
Oil GDP shrank by 0.5 percent, while initial flash estimates had shown it contracting by 1.4 percent. Non-oil growth reached 4.9 percent compared to estimates last month pointing to a 4.2 percent increase.
With Reuters
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Al Arabiya
4 hours ago
- Al Arabiya
SMC Healthcare CFO on upcoming retail IPO after pricing at top end
In this special interview with the CFO of SMC Healthcare on The Riyal Deal Plus, Tom Burges Watson asks Hani Charani about the next steps for the healthcare provider and what investors can expect - from doubling capacity to expanding specialized care - as the IPO is 64.7 times oversubscribed ahead of the retail offering from June 15 to 16. Ali Raza, the strategic advisor to the Saudi Arabia Holding Company breaks down the IPO trend in the Kingdom. Guests: Hani Charani, SMC Healthcare CFO
Arab News
4 hours ago
- Arab News
Spiritual journey of Hajj pilgrims ends with gifts and souvenirs
MAKKAH: Throughout their profound journey of faith, especially as Hajj concludes, pilgrims commonly engage in the cherished custom of purchasing gifts. They flock to the malls and markets of Makkah, particularly those around the Grand Mosque. This tradition expresses their spiritual fulfillment and prepares them for their return home, blessed by Allah for having performed the sacred rites, according to a Saudi Press Agency report. Gift buying represents joy at Hajj's successful conclusion and strengthens social bonds between relatives, SPA added. Many gifts symbolize the holy sites and carry deep religious significance. Popular choices include Zamzam water, prayer beads, and copies of the Holy Qur'an. Pilgrims also frequently buy perfumes like incense and musk, along with various types of dates — ajwa dates being especially sought after. The markets of Makkah and Madinah see a significant boom after Hajj, bustling with pilgrims of diverse nationalities. These vibrant markets include modern malls in the Haram area, the traditional Aziziyah Market, the Hijaz Market, and bazaars near the Prophet's Mosque in Madinah. Merchants actively meet this demand, offering a wide range of products, special offers for pilgrims, and often discounts on bulk purchases.
Arab News
6 hours ago
- Arab News
Saudi commercial bank profits jump 16% in April, topping $2bn before zakat, tax
RIYADH: Saudi Arabia's banking sector extended its winning streak in April, posting SR7.77 billion ($2.07 billion) in pre-zakat and tax profits, a 16 percent increase compared to the same month last year. According to the Saudi Central Bank, also known as SAMA, this brought year-to-date earnings to SR32.97 billion, an annual rise of 20 percent, keeping the Kingdom firmly on course for another record-breaking period. The sustained momentum is attributed to a robust mix of state spending on giga-projects, resilient consumer demand, and still-elevated interest rates. Financing volumes continue to climb, driven primarily by corporate borrowers across a growing range of industries, including manufacturing, utilities, insurance, and private education. Contractors are also racing to secure long-term credit for giga-projects such as NEOM, Diriyah, and the Jafurah gas field. A wider Gulf picture Strong as those local figures are, the broader region is also gaining momentum. A Kamco Invest report released in May showed that Gulf banks collectively earned a record $15.6 billion in the first quarter of 2025, an 8.6 percent increase from a year earlier. Financial institutions in the UAE posted the largest absolute increase, adding $639.6 million, while Saudi lenders recorded the fastest annual growth at 17.2 percent. Kamco added that fee income is rising, costs are under control, and loan-loss provisions fell sharply during the period, cushioning a small dip in net interest income. Investor appetite is visible in market valuations. Forbes Middle East's '30 Most Valuable Banks 2025' March list includes 10 Saudi lenders with a combined market cap of about $269 billion— roughly one-third of the entire ranking. Al Rajhi Bank led the pack at $105.6 billion, with Saudi National Bank following at $54.7 billion. Global Finance named Saudi Awwal Bank the Kingdom's best lender in its May 'World's Best Banks in the Middle East 2025' release, highlighting its HSBC-backed mobile app upgrades, Visa Direct payments, and one-stop small and medium-sized enterprises lending platform. Cleaning the books and raising cash Banks are also getting balance sheets ready for the next investment wave. Bloomberg reported in March that lenders are exploring sales of older non-performing loans to specialist investors to free up capital for upcoming mega project drawdowns. They're also tapping capital markets. By June, they had issued over $5.6 billion in Additional Tier-1 bonds, already a full-year record and the world's second-largest AT1 issuance in 2025, according to Bloomberg. The spree includes Al Rajhi Bank's $1.25 billion deal in April, Banque Saudi Fransi's $650 million perpetual at 6.375 percent in May, Saudi Awwal Bank's $650 million inaugural issue, and Alinma Bank's $500 million of sustainable sukuk, all heavily oversubscribed. By tapping eager investors now, while margins remain healthy and global demand for Gulf paper is strong, lenders are bulking up capital buffers and keeping loan-to-deposit ratios in check. That leaves them better prepared to fund the fast-rising credit needs of projects like NEOM and Diriyah without tripping liquidity alarms later in the year. Fintech role Fintech is reshaping Saudi banking from the ground up. The Saudi Central Bank's Open Banking Framework — most recently updated in September to cover payment-initiation services — sets common technical rules that let lenders and start-ups plug their systems together safely and at speed. Speaking at the inaugural 24 Fintech conference in September, Finance Minister Mohammed Al-Jadaan revealed that the Kingdom had licensed 224 fintech firms by the second quarter of 2024, up from fewer than 100 just three years earlier. One of the newest players is Riyadh-based Stitch, which closed a $10 million seed round on May 28. The company offers a single set of application-programming interfaces that lets banks, fintechs and even non-financial brands bolt on real-time payments and open-banking functions far faster than older systems. Early adopters already include Lulu Exchange and point-of-sale platform Foodics. The founders say the fresh cash will go toward doubling the engineering team and expanding the product suite. Looking ahead Riyad Capital's first-quarter preview, released in April, expects another double-digit profit rise this year, about SR19 billion for the listed banks it tracks, as loan growth stays strong and rate cuts arrive slowly. S&P Global, in its Saudi Arabia Banking Sector Outlook 2025 report, says a 10 percent increase in lending should outweigh a 20- to 30-basis-point dip in margins, keeping sector returns on assets near 2.1 percent to 2.2 percent. Funding is the main watchpoint. Moody's shifted its system outlook to stable on Feb. 25, saying strong credit growth is tightening liquidity, but capital buffers remain solid. For now, asset-quality risks remain low. S&P expects non-performing loans to edge up to just 1.7 percent by the end of 2025, while loan-loss provisions are projected to stay around 50 to 60 basis points. Banks' total capital ratios, hovering near 19 percent, provide a solid buffer to absorb potential shocks from falling oil prices or rising private-sector leverage. Saudi lenders are still the region's earnings workhorse. Profits are rising, market values are high, and fresh money — from bond buyers to venture capitalists — is flowing in. If they can keep gathering deposits quickly enough to fund a fast-growing loan book, the Kingdom's banks look set to stay ahead of their Gulf neighbors in both profit and ambition well into next year.
