Banking
From The Report: Saudi Arabia 2020
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The Kingdom’s banking sector started 2020 on a promising note, with 13 local banks serving a population of over 30m people. However, low oil prices and the disruptive effects of the Covid-19 pandemic are likely to undermine asset growth over the course of the year, though the Kingdom’s banks have previously demonstrated the ability to remain profitable despite difficulties. Looking to the longer term, banks are likely to venture beyond the competitive corporate and retail segments and develop their offering in underserved areas of the market, such as lending to smaller enterprises and microfinance. This chapter contains interviews with Ahmed Alkholifey, Governor, Saudi Arabian Monetary Authority; and Tareq Al Sadhan, CEO, Riyad Bank.

Articles from this Chapter

Overview

Solid foundations: The banking industry enters a challenging 2020 with a sound base and strong regulatory framework
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Saudi Arabia is home to more than 27% of the GCC’s total banking assets, and is the region’s second-largest banking industry in terms of assets and the largest in terms of market capitalisation. Having achieved promising profit growth in 2019, the sector entered 2020 ready to capitalise on the opportunities presented by the Kingdom’s ambitious development strategy. Vision 2030 provides a roadmap for the development of financial services in the country and a raft of lending opportunities…

Analysis

Local talent: The Kingdom is investing in financial education and training to increase the number of Saudis in high-ranking positions
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In recent years the government has sought to increase the number of nationals in the workforce through Saudiisation policies, which mandate that companies have a certain percentage of Saudi citizens in each position. However, the policy has presented significant challenges for many sectors that still rely heavily on expatriate labour. Since 2011 the government has used the Nitaqat scheme to incentivise and penalise companies based on the number of Saudi employees. The system applies quotas…

Interview

Take it to the bank: Ahmed Alkholifey, Governor, Saudi Arabian Monetary Authority (SAMA), on boosting financial inclusion amid global disruption
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Interview:Ahmed Alkholifey What measures are being taken to mitigate the impact of Covid-19 on the banking sector? AHMED ALKHOLIFEY: The Saudi authorities took strong and decisive action in March 2020 to mitigate the spread of Covid-19. The economic implications of the pandemic are still unfolding. Indeed, SAMA is maintaining close communication with players in the financial sector and other institutions under its supervision, and is following all developments carefully. We are ensuring the…

Interview

Digital solutions: Tareq Al Sadhan, CEO, Riyad Bank, on the increasing influence of technology in the financial sector
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Interview:Tareq Al Sadhan How are digitalisation and financial technology (fintech) positively disrupting retail banking? TAREQ AL SADHAN: Digital banking in general and fintech in particular are evolving from traditional banking channels, leveraging big data and smart technologies to provide customers with fast and secure financial services. This digital transformation increased competition in the banking sector and encouraged financial institutions to come up with creative solutions to enhance…

Overview

A swing in the balance: Following a retrenchment of overseas operations by numerous major banks, how are firms in emerging markets responding?
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The three decades before the 2007-08 global financial crisis were marked by the world’s financial networks becoming increasingly interconnected. Financial system regulatory convergence, the growing penetration of World Trade Organisation rules and the creation of currency unions, such as the euro, resulted in a surge in cross-border capital flows. Global banks began to see the emergence of a single international marketplace, and the potential this held for revenue and asset growth. In 1998 co-chairman of the freshly formed Citigroup, Sandford Weill, announced the dawn of a new age of banking in which large institutions would act as financial…