Saudi Arabia is easing rules on bank lending to stimulate growth in
the largest Arab economy, two people with knowledge of the matter said.
Banks
were told they can lend the equivalent of 90 percent of their deposits,
up from an earlier limit of 85 percent, by the Saudi Arabian Monetary
Agency on Sunday, the people said, asking not to be identified as the
information is private.
The move followed a request from the country’s committee of treasurers to ease liquidity constraints, one of the people said.
Saudi Arabia is seeking to revive its economy and stimulate credit as the slump in oil and government spending strain the banking system.
The three-month Saudi Arabia Interbank rate rose to 1.73 percent on Feb. 3, its highest in about seven years, according to data compiled by Bloomberg. Bets for a devaluation of the riyal reached their highest in about two decades in January, even after the country pledged to keep its currency peg.
Calls and e-mails sent to SAMA, as the central bank is known, after office hours in Riyadh weren’t immediately returned.
The move followed a request from the country’s committee of treasurers to ease liquidity constraints, one of the people said.
Saudi Arabia is seeking to revive its economy and stimulate credit as the slump in oil and government spending strain the banking system.
The three-month Saudi Arabia Interbank rate rose to 1.73 percent on Feb. 3, its highest in about seven years, according to data compiled by Bloomberg. Bets for a devaluation of the riyal reached their highest in about two decades in January, even after the country pledged to keep its currency peg.
Calls and e-mails sent to SAMA, as the central bank is known, after office hours in Riyadh weren’t immediately returned.
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