Derayah to invest SAR 100M in D360 Bank capital increase

D360 Bank plans to use capital increase proceeds to support the next phase of growth

Derayah Financial Co. plans to invest SAR 100 million in D360 Bank's planned capital increase, which is expected to raise the company's ownership stake value to about SAR 980 million upon completion of the transaction, according to a statement to Tadawul.

Derayah said D360 Bank's extraordinary general meeting (EGM) approved a recommendation to increase the bank's capital by 38.89% to SAR 2.92 billion from SAR 2.1 billion.

The investment firm, which owned a 20.4% stake in D360 Bank as of March 31, 2026, said it intends to participate in the capital increase as part of its long-term strategic commitment to the digital lender.

Following the completion of the capital increase, Derayah expects its ownership stake in the bank to stand at 16.35%, based on D360 Bank's post-money valuation of SAR 6 billion ($1.6 billion).

The capital increase will be carried out through the issuance of 72.92 million new ordinary shares at a subscription price of SAR 20.57 per share, generating total proceeds of SAR 1.5 billion.

Subject to regulatory approvals, D360 Bank will also issue an additional 8.75 million ordinary shares under its Employee Stock Ownership Plan (ESOP). The ESOP shares will be funded through SAR 87.5 million from the capital increase proceeds.

Derayah said the offering price implies a fully diluted pre-money valuation of SAR 4.5 billion ($1.2 billion), including the ESOP shares planned to be issued as part of the transaction.

As its investment in D360 Bank is accounted for under the equity method, Derayah said it will not recognize any unrealized gains arising from the implied valuation of the bank. Accordingly, the transaction is not expected to have any impact on the company's reported earnings or shareholders' equity.

The proposed investment will be fully funded from Derayah's own resources and is not expected to affect the company's dividend policy, reflecting the strength of its financial position, capital base, and cash-generation capabilities.

Derayah added that up to 2.26% of its expected 16.35% stake in D360 Bank has been allocated to eligible employees under an employee share ownership program disclosed in its prospectus. Should any of those shares be transferred, the company's ownership stake would decline by a corresponding amount.

Since launching operations in December 2024, D360 Bank has grown its customer base to 3 million and attracted SAR 3 billion in deposits as of April 2026. The bank has also recorded positive performance indicators across its core products, demonstrating a profitable business model and a clear path toward profitability as it expands.

The capital increase proceeds will be used to support the bank's next phase of growth, with a focus on expanding its financing portfolio, enhancing products and capturing opportunities in Saudi Arabia's retail banking, small and medium-sized enterprise financing, and API banking markets.

Derayah described D360 Bank as a strategic partner and a key component of its broader ecosystem strategy, offering opportunities to expand customer reach, enhance product distribution, and benefit from cross-selling and integration opportunities.

The company noted that D360 Bank is considered a related party under applicable regulations because Derayah has the right to appoint more than 30% of the bank's board members.

Derayah said it will announce any material developments related to the transaction in due course.