Gulf loans to troubled groups ‘manageable’

The exposure of the largest banks in the oil-rich Gulf to two of Saudi Arabia’s most prominent companies struggling with financial difficulties is significant but manageable, Standard & Poor’s said on Wednesday.

The ratings agency reviewed 30 commercial banks it rates in the six countries of the Gulf Co-operation Council – Saudi Arabia, Kuwait, Qatar, the United Arab Emirates, Bahrain and Oman – to gauge their exposure to Saad Group, which is owned by Maan al-Sanea, a Saudi billionaire, and entities owned by the Algosaibi family.

The banks surveyed by S&P represent about two-thirds of the total assets of GCC banks, said Emmanuel Volland, an analyst at the ratings agency. S&P did not reveal the scale of the exposure of the banks reviewed.