While many Western, especially European, banks are struggling, Saudi Arabia's banks are in the midst of an expansionary boom, with further growth predicted as new market areas open up creating more opportunities. But unlike their counterparts in neighbouring Gulf states, Saudi Arabian banks are largely focused on their domestic market. As the largest petroleum exporter in the world, and with a population set to touch 30 million in 2013, there is a much larger domestic market to tap.
While political tensions and uncertainties remain in Syria and Iran, Paul Gamble of Riyadh-based Jadwa Investment has revised his forecast for Saudi Arabia's oil price and output for 2012. This projected upward growth, detailed in an April 2012 report, would lead to record oil revenues and budget and current account surpluses in 2012. Oil revenues – the source of 90% of Saudi Arabia's budget revenues – are now expected to reach a record high of SR1150bn ($307bn) and Jadwa has raised its forecast for Saudi Arabia's real growth rate from 4.5% to 5.1% on the back of these revised figures.
