Banking

Saudi Arabia’s banking sector is one of the largest and most vibrant in the Middle East, with three of its domestically licensed institutions in the regional top 10 by net assets. Historically the sector has thrived on the rise of high-value lending derived from the government’s infrastructure programmes, but recent years have seen local lenders pursue a growing number of opportunities in the consumer and small and medium-sized enterprise segments. More recently, low oil prices have raised questions about the domestic industry’s ability to maintain its healthy margins, and the sector will likely enter 2017 facing one of the most difficult operating environments in recent times. However, a history of prudent regulation means that the industry has sufficient buffers to ride out this part of the cycle, albeit with a modest softening of performance indicators.

This chapter contains a viewpoint from Ahmed Alkholifey, Governor, Saudi Arabian Monetary Agency; and interviews with Bernd van Linder, CEO, Saudi Hollandi Bank; Abdulaziz A Al Helaissi, CEO, Gulf International Bank; and Steve Bertamini, CEO, Al Rajhi Bank.