Al Rajhi: A family bank plans for its future
What does the future hold for family ownership and oversight at Al Rajhi Bank?
The issue of succession at Al Rajhi Bank, in terms of both ownership and oversight, is becoming ever more pertinent. Sulaiman Al Rajhi’s brother, Saleh (the other main founding shareholder), passed away in 2011. The chairman of Al Rajhi Bank, Sulaiman Al Rajhi, is already in his mid-80s.
Sulaiman Al Rajhi has already started selling down his fortune into charity as part of his succession planning. Some sons and daughters of the late Saleh Al Rajhi are also thought to have sold their shares in the bank into the local stock market (which might not of course prevent other members of the family buying them back).
A listing on the local exchange accounts for 45% of the bank’s stock. But the family remains dominant on the board, and in any case investors on the public market hold little sway, as they are mostly individual retail investors.
"This will remain a family-owned bank for the foreseeable future," says Suliman Azzabin, the bank’s CEO. "The vice-chairman, Abdullah [son of] Sulaiman Al Rajhi, knows the bank very well. He was CEO [of the bank] for 15 years."
Azzabin adds: "Nothing has been decided yet, but [Abdullah Bin Sulaiman Al Rajhi] could be a good candidate to become chairman in the future."