As the full-year 2014 performance figures for Saudi banks emerged in late January, the underlying strength of the sector was made clear. Most had registered stellar growth figures across their business lines, despite a precipitous six-month slide in oil prices and the attendant concerns over the country’s economic growth prospects. Today, the Saudi banking sector is rightly viewed as one of the strongest and most profitable anywhere in the world. In part, this ongoing success story has been driven by the healthy levels of government spending and longer term economic growth.
However, the figures also reflect the prudent banking culture that exists in the country. Most Saudi lenders have kept focus on core commercial banking, eschewing risky and complex products, as well as overly ambitious expansion plans. The central bank, the Saudi Arabian Monetary Agency (SAMA), has also played its part in navigating the country’s financial system through the challenges of the global financial crisis and remains widely respected by banking sector participants.
