Al-Rajhi Bank

Abstract

The Al-Rajhi Bank was established in Riyadh, Saudi Arabia, in 1957 by the Al-Rajhi brothers. Over time, it has expanded its operations and emerged as one of the leading global financial institutions specializing in Islamic Banking. The institution functions under the supervision of a Sharia Board, which bears the responsibility of ensuring the adherence of all banking services to the principles of Islamic law. These services encompass a diverse array of financial products that cater to both retail and commercial banking needs. In spite of the bank’s favorable performance during global crises, it faces challenges in its competition with conventional banks, similar to other Islamic finance institutions operating globally. These challenges primarily stem from the elevated costs associated with Islamic banking products. Hence, in order to enhance the competitiveness of the sector while upholding its fundamental principles, it is imperative to make new investments. The bank encounters an additional challenge, particularly in the aftermath of the September 11 attacks, as it faces allegations of involvement in the facilitation of terrorist financing. Nevertheless, the legal proceedings conducted against the bank reached a swift resolution in favor of the bank due to insufficient evidentiary support for the allegations.