RIYADH: Al Rajhi Bank, the largest lender in the Kingdom, announced the increase of its stake in Al Rajhi Company for Cooperative Insurance to 35%.

The bank has also obtained approval from the Central Bank of Saudi Arabia to complete the process of increasing its stake in the insurer, the bank said in a stock exchange filing.

Before the increase, the bank held 22.5% of Al Rajhi Takaful, or 9 million shares.

The bank said the move is aimed at strengthening its role in the development of the financial sector, as well as deepening its presence through partnerships that contribute to the development of financial products that will be distributed to its customers in the future.

It also aims to support Al Rajhi Takaful as well as its qualified executives in realizing the company’s strategy in the insurance industry in line with the company’s vision and mission.

Al Rajhi Bank CEO Waleed Al-Mogbe said the importance of such a strategic move lies in enhancing the bank’s leadership role in the sector and its ability to effectively contribute to the achievement of Vision 2030 by developing the insurance industry and its relationships. with the financial sector in order to strengthen the bank’s position in the sector.

Earlier, Al Rajhi announced its first half results, reporting a profit of SR8.4 billion ($2.2 billion), a 21% increase in profit from 6.9 billion. of SR from the same period last year.

The bank’s profit growth was partly due to a 15% increase in operating profit, which was attributed to higher financing and investment income, banking service fees and foreign exchange income.

That said, he noted that depreciation, higher salaries and benefits weighed on costs over the six-month period, resulting in a 4.5% increase in operating expenses.

Al Rajhi Bank’s funding impairment charges decreased slightly from SR 1.16 billion to SR 1.16 billion, the bank said in the earnings report.

In a different direction, Al Rajhi Company for Cooperative Insurance recorded a net profit of SR58 million in the first half of 2022, down 42% from SR100.2 million a year ago.

The insurer’s net profit decreased by 6.61% year-on-year due to an increase in the number of net claims incurred and a 45.23% increase in the cost of acquiring new fonts.