Is the NCB still Saudi Arabia's Prominent Bank?

Abstract

As a pioneering financial institution in the Kingdom of Saudi Arabia (KSA), the National Commercial Bank (NCB) is one of the oldest, if not the first Saudi banks.  Distinguished amongst the rest, its history of success spreads several decades now. The National Commercial Bank considered Islamic concepts and principles as a major source of the banking business policies within the company. It is strongly influenced by the Saudi culture, which relies on religious teachings as the main source of folkways, mores and shari'ah laws for serving customers. The application of Islamic and shari'ah administrative tools in the banking business of NCB reflects positively on its entire exemplary performances and which succeeded in gaining  employees’ commitment and customer loyalty towards it. The NCB is the first bank in the KSA to initiate the Corporate Social Responsibility (CSR) programs in 2004 and targeted the different sectors of the economy especially in improving the health and education sectors. It has served its clients including non-bankable ones through social institutions. It provided financial and credit facilities and loans to them, built homes for the homeless in developing countries, and sponsored humanitarian organizations to eliminate global problems emanated from global warming, destitute and child labour, as well as contributed to the growth of the KSA economy and assisted in achieving the sustainable development goals for other countries in which it operated.

Beside its CSR records, the NCB is one of the largest Banks in the Arab world. The Bank's paid-up capital amounted to SAR 30 billion (US$ 8 billions) and its assets at end of 2017 totaled SAR 444 billion (US$ 118 billion). The net profit for the year 2017 totaled SAR 9,802 million (US$ 2,614 million). Shareholders' equity at the end of 2017 totaled SAR 64,276 million (US$ 17,140 million). Return on average shareholder's equity for the fiscal year 2017 was 17.8%. Basic earnings per share for the year 2017 amounted to SAR 4.74 (US$ 1.26). The bank also maintained its leadership in corporate governance. A number of new programs were launched to enhance NCB’s strategic partnerships and geographic coverage. Various initiatives included job opportunity programs that provided entrepreneurs with knowledge, support, and generous loans for sustainability had been introduced by NCB. Currently, despite the socio-economic crisis brought by the Covid-19 pandemic, the bank still operated 400 branches throughout the KSA. These branches are dedicated exclusively to Islamic Banking services. At the end of 2017, the Bank's clients exceeded 5.9 million and its employees throughout the KSA reached a total of 7,973 of which 95.3% were Saudis. This reflects the true sense of nationalism introduced by the KSA under the Saudisation National policy.