Saudi Gazette - Saudi bank credit to rise further as construction boom continues

Saudi Gazette - Saudi bank credit to rise further as construction boom continues:

"Saudi bank credit for construction activities, which rebounded in 2010, will continue to grow into 2014, the National Commercial Bank said in its report on “Government and Private Financing Accelerate the Execution of Infrastructure Projects”. 

The report noted that the amount of money being invested into infrastructure projects will encourage commercial banks to increase their lending to construction contractors. With many mega-projects in the pipeline, bank lending will play a critical role in the growth of the sector.

The financing landscape is witnessing the use of financing alternatives besides traditional bank lending. The emergence of sukuk and PPPs have given both, government and private entities, the ability to diversify their financial exposure, while still hedging against project risk. These financing alternatives also give government entities, like SEC, the option to redirect available funds to transmission and distribution (T&D), while reallocating expenditures from capital expenses to operational expenses. This helps avoiding mismatches between medium-term financing and long life public-private projects. "

'via Blog this'