Ashraf Madani, Vice President and Senior Analyst at Moody’s Credit score Scores Company
Ashraf Madani, Vice President and Senior Analyst at Moody’s Credit score Scores Company, mentioned that the working surroundings for the banking sector in Saudi Arabia stays robust, and is predicted to stay so throughout the coming interval, which helps banks’ profitability and monetary stability regardless of some challenges associated to financing and liquidity.
Madani added in reply to a query numbersThroughout a media briefing, he mentioned that the Saudi banking sector nonetheless exhibits excessive flexibility within the face of financing pressures, explaining that the banks have thus far been capable of cowl the financing hole because of their potential to entry worldwide markets, though this entry remains to be at low ranges in comparison with their world counterparts.
He identified that the ratio of loans to deposits rose to about 114-115%, anticipating that this ratio has reached its peak or is near that, which is able to push banks to be extra selective in granting credit score throughout the subsequent financing cycle.
He indicated that the demand for credit score remains to be robust, however the provide facet could witness some slowdown, as banks are anticipated to scale back the variety of authorised financing requests in proportion to the tempo of deposit development with a view to keep a stability of liquidity and profitability.
Madani pressured that the continued power of the working surroundings and financing flexibility would help credit score within the medium time period, regardless of the challenges associated to the price of financing and excessive lending charges.
