Saudi Arabian banks have plenty of scope to fund loan growth in 2012 as the sector relaxes the cautious approach to lending that has dominated in the last few years, Fitch Ratings says.
This growth is likely to be at a reasonable pace and therefore should not hurt asset quality or banks’ viability ratings, said a statement from the rating agency.
It pointed out that rising deposits and several years of subdued loan growth had allowed Saudi banks to build up substantial surplus liquidity in the form of government securities and deposits with the Saudi Arabian Monetary Agency (SAMA).
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