A collaborative research project between New York University Abu Dhabi and Tharawat Family Business Forum

Spotlight

Al Rajhi Bank

Information last updated on 12 December 2022

Snapshot

Founding

Family Name:

Al Rajhi

Founder’s Name:

Saleh Al Rajhi [1]

Earliest Documented Business Name:

Saleh bin Abdulaziz Al Rajhi Exchange”[2]

Founding Year:

1956[3]

Founding Location:

Saudi Arabia

Today

Current Operating Status:

Operating

Family Business Name:

Al Rajhi Bank (Masraf Al Rajhi)

Headquarters Location:

Riyadh, Saudi Arabia

Key Industries:

Financial Services

Number of Employees:

9,300+[4]

ABOUT THE FOUNDER

Saleh bin Abdulaziz Al Rajhi was born in 1920[5] in the city of Bkeriyah in Al Qassim Province in modern-day Saudi Arabia.[6] He grew up with his parents, Abdulaziz and Ayesha Al Rajhi,[7] and four siblings.[8] In 1932, the Kingdom of Saudi Arabia was officially formed, leading to major developments in the capital city of Riyadh. Like many Saudis at the time,[9] Abdulaziz and other members of his family moved to Riyadh, motivated by the rise of job opportunities there.[10]

 

In Riyadh, the family settled in a house on Al-Sweilam Street.[11] Abdulaziz started out trading in bshoot (traditional Saudi men’s clothes), then later worked as a construction worker.[12] Meanwhile, Saleh and his siblings received their early education at the Quranic school of Al-Jami’ Al-Kabir mosque, in Riyadh’s Deira neighborhood.[13] Growing up in a poverty-stricken family led young Saleh to constantly look for ways to generate income.[14] Seeing that his family could not afford their rent, he began working as a porter and was able to help out.

 

Saleh discovered a passion for entrepreneurship and, in the 1940s, set up shop at a local market where he sold tools and other hardware. His exposure to market dynamics swiftly enabled him to spot a business opportunity. He noticed that many traders were importing carpets from Kuwait and Iran, which inspired him to enter the field of money exchange. Responding to the lack of a proper banking or currency system in Saudi Arabia at the time, he offered exchange services for the value of gold and silver pieces.[15]

 

Meanwhile, his younger sibling Sulaiman, born in 1928, was following a similar path,[16] Sulaiman’s first job, when he was only 10 years old, was as a porter on the weekends —he would deliver food and groceries from the local market to customers’ homes. In 1940, Sulaiman was able to get a seasonal job during the Kharaf season (harvesting of palm trees),[17] for which he was paid six Saudi riyals a month. After the end of the season, he started a new job as a cook.[18]

 

In 1941, 21-year-old Saleh Al Rajhi got married[19] to Noora Yousef Al Malahi.[20] One year later, Saleh and Sulaiman’s parents divorced, and 14-year old Sulaiman moved out to live with his mother, who was very sick at the time. To help support her financially, Sulaiman got a job as a coffee maker for the Bin Laden family. He also started to buy tea and sugar in bulk, which he resold in individual packages to people on their way to work in the mornings. [21]

FOUNDING STORY

In the 1940s, Saleh would head to the local market every morning to display the currencies he had on the sidewalk to attract clients. As one of the few Saudis to offer such a service at the time, his client base grew rapidly. A few years later, in the aftermath of the Second World War, Saleh had accumulated enough savings to open his first shop, in the Deira neighborhood.[22] Shortly after, observing his younger brother passion for entrepreneurship and demonstrable business skills, he offered Sulaiman a job at his currency exchange business.[23] Around 1957, Saleh officially registered the business under the name Saleh bin Abdulaziz Al Rajhi Exchange — the first formally recognized local exchange in the Najd region[24]  — and siblings Mohammed and Abdullah joined the operation.[25]

Growth Phase

A fruitful relationship with the Saudi state began to take shape, as the government depended on Al Rajhi for currency exchange before the first Saudi public bank was officially founded.[26] Over the following decades, Al Rajhi’s business witnessed a series of important developments in parallel with the government’s development strategy for the country’s Islamic banking sector. Starting in 1963 with the creation of the Saudi Agricultural Development Fund,[27] followed by the Public Investment Fund in 1971[28] and the Real Estate Development Fund in 1972,[29] the Al Rajhi brothers played important roles in providing financial services to the state. As their operations expanded beyond currency exchange, they set up branch offices that offered a variety of banking and commercial services in Riyadh and Jeddah.[30] In 1978, the various business operations were consolidated under the Al Rajhi Trading and Exchange Corporation.[31] In 1982, the Al Rajhi family established Hail Agriculture Development Co., which quickly became one of the main suppliers of alimentary products in Saudi Arabia.[32]

 

In 1987, Al Rajhi Banking and Investment Corporation was formed as a joint-stock holding company.[33] By the 1990s, Al Rajhi had grown into a full-fledged Islamic bank, providing wholesale, retail, and commercial banking and investment services.[34] The bank became widely successful as it continued to benefit from the large-scale developments that accompanied the Saudi oil boom. Saleh’s wife, Noora, grew into a beloved community figure for her charitable work. She established the Noora Al Malahi Foundation,[35] which funded a variety of nonprofit initiatives.[36] The couple had a total of ten children: four sons and six daughters.[37] Several members of the second generation became involved in the family business operations, while others launched their own businesses.[38] The founder’s son Abdulwahab Saleh Al Rajhi is chairman of the company.[39] Other sons launched their own firms: Naif started Naif Al-Rajhi Investment Company,[40] and Salman started Salman Saleh Al Rajhi Commercial Services Office.[41] In 2006, the main family business was officially renamed Al Rajhi Bank. In 2011, founder Saleh Al Rahji passed away at around 90 years old.[42]

TODAY

Today, Al Rajhi Bank is one of the largest banks in the Middle East and the largest Islamic bank in the world.[43] Run by members of the second generation, with non-family members also involved in the leadership,[44] the bank has over 9,000 employees and a network of over 515 branches,[45] primarily inside Saudi Arabia, but also in Kuwait, Jordan, and Malaysia.[46] In addition to its core business in the finance and investment sector, the Al Rajhi family owns an array of additional businesses, with a diversified portfolio ranging from manufacturing[47]  to construction, agriculture,[48]  and many other fields.[49]

Notes

Photo Credit: Building of Al Rajhi Company for Banking and Investment in the 1980s. Source: Wikipedia

[1]“Our History.” Al Rajhi Bank, https://www.alrajhibank.com.my/page/about-us/corporate-info-92/our-history-97. Accessed 12 December 2022.

[2]“سيرة وحياة الشيخ الراحل صالح الراجحي في برنامج الراحل مع محمد الخميسي.” YouTube, 7 June 2018, https://www.youtube.com/watch?v=fQASAtImxTA. Accessed 12 December 2022.

[3]“سيرة وحياة الشيخ الراحل صالح الراجحي في برنامج الراحل مع محمد الخميسي.” YouTube, 7 June 2018, https://www.youtube.com/watch?v=fQASAtImxTA. Accessed 12 December 2022.

[4]“عن مصرف الراجحي.” مصرف الراجحي, https://www.alrajhibank.com.sa/About-alrajhi-bank. Accessed 12 December 2022.

[5]“سيرة وحياة الشيخ الراحل صالح الراجحي في برنامج الراحل مع محمد الخميسي.” YouTube, 7 June 2018, https://www.youtube.com/watch?v=fQASAtImxTA. Accessed 12 December 2022.

[6]“ما لا تعرفه عن صالح الراجحي .. من هو؟ سيرته الذاتية، إنجازاته وأقواله، معلومات عن صالح الراجحي.” AraGeek, 23 December 2022, https://www.arageek.com/bio/saleh-al-rajhi. Accessed 12 December 2022.

[7]“سيرة وحياة الشيخ الراحل صالح الراجحي في برنامج الراحل مع محمد الخميسي.” YouTube, 7 June 2018, https://www.youtube.com/watch?v=fQASAtImxTA. Accessed 12 December 2022.

[8]“الراجحي.. ملياردير سعودي انطلق من الصفر | شخصيات.” الجزيرة نت, 7 March 2016, https://1-a1072.azureedge.net/encyclopedia/icons/2016/3/7/%D8%A7%D9%84%D8%B1%D8%A7%D8%AC%D8%AD%D9%8A-%D9%85%D9%84%D9%8A%D8%A7%D8%B1%D8%AF%D9%8A%D8%B1-%D8%A3%D9%81%D9%82%D8%B1%D9%87-%D8%A7%D9%84%D9%88%D9%82%D9%81. Accessed 12 December 2022.

[9] Elsheshtawy, Yasser. Riyadh : Transforming a Desert City, Taylor & Francis Group, 2021. ProQuest Ebook Central, https://ebookcentral.proquest.com/lib/nyulibrary-ebooks/detail.action?docID=6694113. P. 121

[10]“سيرة وحياة الشيخ الراحل صالح الراجحي في برنامج الراحل مع محمد الخميسي.” YouTube, 7 June 2018, https://www.youtube.com/watch?v=fQASAtImxTA. Accessed 12 December 2022.

[11]“سيرة وحياة الشيخ الراحل صالح الراجحي في برنامج الراحل مع محمد الخميسي.” YouTube, 7 June 2018, https://www.youtube.com/watch?v=fQASAtImxTA. Accessed 12 December 2022.

[12]“سيرة وحياة الشيخ الراحل صالح الراجحي في برنامج الراحل مع محمد الخميسي.” YouTube, 7 June 2018, https://www.youtube.com/watch?v=fQASAtImxTA. Accessed 12 December 2022.

[13]“سيرة وحياة الشيخ الراحل صالح الراجحي في برنامج الراحل مع محمد الخميسي.” YouTube, 7 June 2018, https://www.youtube.com/watch?v=fQASAtImxTA. Accessed 12 December 2022.

[14]“برنامج بموضوعية/ الشيخ سليمان بن عبدالعزيز الراجحي – الجزء الأول.” YouTube, 9 March 2015, https://www.youtube.com/watch?v=5a4ROc3tq9k. Accessed 12 December 2022.

[15]“سيرة وحياة الشيخ الراحل صالح الراجحي في برنامج الراحل مع محمد الخميسي.” YouTube, 7 June 2018, https://www.youtube.com/watch?v=fQASAtImxTA. Accessed 12 December 2022.

[16]“برنامج بموضوعية/ الشيخ سليمان بن عبدالعزيز الراجحي – الجزء الأول.” YouTube, 9 March 2015, https://www.youtube.com/watch?v=5a4ROc3tq9k. Accessed 12 December 2022.

[17]“تقويم | ما سبب تسمية موسم خراف النخيل بهذا الاسم؟.” YouTube, 9 June 2022, https://www.youtube.com/watch?v=hax4Rma5NXo. Accessed 12 December 2022.

[18]“برنامج بموضوعية/ الشيخ سليمان بن عبدالعزيز الراجحي – الجزء الأول.” YouTube, 9 March 2015, https://www.youtube.com/watch?v=5a4ROc3tq9k. Accessed 12 December 2022.

[19]“برنامج بموضوعية/ الشيخ سليمان بن عبدالعزيز الراجحي – الجزء الأول.” YouTube, 9 March 2015, https://www.youtube.com/watch?v=5a4ROc3tq9k. Accessed 12 December 2022.

[20]“من هي نورة الملاحي ويكيبيديا – المحيط.” المحيط, 1 October 2022, https://www.almuheet.net/post/336227. Accessed 12 December 2022.

[21]“برنامج بموضوعية/ الشيخ سليمان بن عبدالعزيز الراجحي – الجزء الأول.” YouTube, 9 March 2015, https://www.youtube.com/watch?v=5a4ROc3tq9k. Accessed 12 December 2022.

[22]“سيرة وحياة الشيخ الراحل صالح الراجحي في برنامج الراحل مع محمد الخميسي.” YouTube, 7 June 2018, https://www.youtube.com/watch?v=fQASAtImxTA. Accessed 12 December 2022.

[23]“سيرة وحياة الشيخ الراحل صالح الراجحي في برنامج الراحل مع محمد الخميسي.” YouTube, 7 June 2018, https://www.youtube.com/watch?v=fQASAtImxTA. Accessed 12 December 2022.

[24]“سيرة وحياة الشيخ الراحل صالح الراجحي في برنامج الراحل مع محمد الخميسي.” YouTube, 7 June 2018, https://www.youtube.com/watch?v=fQASAtImxTA. Accessed 12 December 2022.

[25] “Fact Sheet.” https://www.alrajhibank.com.sa/-/media/Project/AlrajhiPWS/Shared/Home/about-alrajhi-bank/Investor_Relation/Financial-Materials/2022/Q1/Fact-Sheet/Fact_Sheet_V2.pdf. Accessed 11 Dec. 2022.

[26]“سيرة وحياة الشيخ الراحل صالح الراجحي في برنامج الراحل مع محمد الخميسي.” YouTube, 7 June 2018, https://www.youtube.com/watch?v=fQASAtImxTA. Accessed 12 December 2022.

[27] “نبذة عن الصندوق.” صندوق التنمية الزراعية, https://adf.gov.sa/ar/AboutUs/Pages/Brief.aspx. Accessed 12 December 2022.

“Our History.” Al Rajhi Bank, https://www.alrajhibank.com.my/page/about-us/corporate-info-92/our-history-97. Accessed 12 December 2022.

[28]“صندوق الاستثمارات العامة.” المعرفة, https://www.marefa.org/%D8%B5%D9%86%D8%AF%D9%88%D9%82_%D8%A7%D9%84%D8%A7%D8%B3%D8%AA%D8%AB%D9%85%D8%A7%D8%B1%D8%A7%D8%AA_%D8%A7%D9%84%D8%B9%D8%A7%D9%85%D8%A9. Accessed 12 December 2022.

[29]“التأسيس والمهام.” صندوق التنمية العقارية, https://portal.redf.gov.sa/ar/AboutREDF/Pages/aboutus.aspx. Accessed 12 December 2022.

[30]“برنامج بموضوعية/ الشيخ سليمان بن عبدالعزيز الراجحي – الجزء الأول.” YouTube, 9 March 2015, https://www.youtube.com/watch?v=5a4ROc3tq9k. Accessed 12 December 2022.

[31]“Our History.” Al Rajhi Bank, https://www.alrajhibank.com.my/page/about-us/corporate-info-92/our-history-97. Accessed 12 December 2022.

[32]“شركة حائل للتنمية الزراعية – هادكو؟ | ملف الشركة.” من هم؟, https://manhom.com/%D8%B4%D8%B1%D9%83%D8%A7%D8%AA/%D8%B4%D8%B1%D9%83%D8%A9-%D8%AD%D8%A7%D8%A6%D9%84-%D9%84%D9%84%D8%AA%D9%86%D9%85%D9%8A%D8%A9-%D8%A7%D9%84%D8%B2%D8%B1%D8%A7%D8%B9%D9%8A%D8%A9-%D9%81%D8%B1%D8%B9/. Accessed 12 December 2022.

[33]“Our History.” Al Rajhi Bank, https://www.alrajhibank.com.my/page/about-us/corporate-info-92/our-history-97. Accessed 12 December 2022.

[34]“Our History.” Al Rajhi Bank, https://www.alrajhibank.com.my/page/about-us/corporate-info-92/our-history-97. Accessed 12 December 2022.

[35]“نورة الملاحي إلى رحمة الله تعالى.. ويبقى الأثر.” التحول التقني, 30 May 2021, https://altqniah.sa/news/view/97. Accessed 12 December 2022.

[36] نورة الملاحي إلى رحمة الله تعالى.. ويبقى الأثر – التحول التقني.” 30May. 2021, https://altqniah.sa/news/view/97. Accessed 11 Dec. 2022.

[37]الجريوي, خالد بن ابراهيم. “خالد بن ابراهيم الجريوي on Twitter: “إنّا لله وإنّا إليه راجعون ولا حول ولا قوة إلا بالله العليّ العظيم. أحسن الله عزاء إخوتي وأخواتي أبناء #الشيخ_صالح_الراجحي رحمه الله: خالد عبدالوهاب سلمان نايف فاطمة هدى منى لولو هيفاء خلود في وفاة والدتهم مساء أمس #نور.” Twitter, https://twitter.com/k_i_j99/status/1398528397488398337. Accessed 12 December 2022.

[38]Rahal, Maya. “What does a Saudi investment firm look for in a startup?” Wamda, 17 June 2013, https://www.wamda.com/2013/06/what-does-a-saudi-investment-firm-look-for-in-a-startup-. Accessed 12 December 2022.

[39]“Akam Developments, Al Rajhi Saudi Group Jointly Launch Akam AlRajhi Developments | INVEST-GATE.” Invest Gate, 14 June 2022, https://invest-gate.me/news/akam-developments-al-rajhi-saudi-group-jointly-launch-akam-alrajhi-developments/. Accessed 12 December 2022.

[40] “Riyad Real Estate Income Fund closes subscriptions on reaching ….” 10 Jun. 2015, https://www.arabnews.com/corporate-news/news/759496. Accessed 11 Dec. 2022.

[41] “Salman Saleh Al Rajhi Commercial Services Office – ClarifiedBy.” https://clarifiedby.diligenciagroup.com/company/summary/4606312-salman-saleh-al-rajhi-commercial-services-office/. Accessed 11 Dec. 2022.

[42]“وفاة رجل الأعمال السعودي صالح الراجحي .. أبرز رواد المصرفيين العرب.” العربية, 12 February 2011, https://www.alarabiya.net/articles/2011%2F02%2F12%2F137370. Accessed 12 December 2022.

[43]“Islamic Financial Institutions in the World and Turkey.” DergiPark, https://dergipark.org.tr/tr/download/article-file/1181908. Accessed 12 December 2022.

[44]“Al Rajhi Bank in 2021.” Al Rajhi Bank in 2021, https://www.alrajhibank.com.sa/ir/corporate_governance/board_of_directors.html. Accessed 12 December 2022.

[45]About Alrajhi Bank. http://www.alrajhibank.com.sa/About-alrajhi-bank. Accessed 27 Dec. 2022.

[46]https://www.alrajhibank.com.sa/ir/business_in_perspective/subsidiaries_and_international_branches.html

[47]“AlRajhi Industrial.” Alrajhi Invest, https://alrajhinvest.com/companies/alrajhi-industrial/. Accessed 12 December 2022.

[48]“Alrajhi.” مجموعة الراجحي السعودية, https://alrajhi.com.sa/english. Accessed 12 December 2022.

[49] Refinitiv

To cite this article please use:

“Al Rajhi Bank” Family Business Histories Research Project, New York University Abu Dhabi and Tharawat Family Business Forum, 20 Mar. 2023, familybusinesshistories.org/spotlights/alrajhi-bank