Banking

Despite the effects of lower international oil prices placing downward pressure on sector profitability, Saudi Arabia’s banks have succeeded in expanding their assets over the past year. While the trend of lower profits is likely to prevail over the medium term, the Kingdom’s banks are well positioned to capitalise on the growth opportunities encompassed in the country’s new economic development strategy. The modern banking landscape emerged from the oil boom that followed the Second World War, a period of economic transformation driven by strong revenue flows from growing hydrocarbons exports. A rapidly expanding money supply and an increasing number of banking institutions called for greater supervision of the market, and in 1952 the Saudi Arabian Monetary Authority was established and tasked with regulating the banking industry.

This chapter contains interviews with Ahmed Alkholifey, Governor, Saudi Arabian Monetary Authority; Rania Nashar, CEO, Samba Financial Group; and Soren Nikolajsen, Managing Director, Alawwal Bank.