Saudi Arabia’s central bank is injecting 50 billion riyals (Dh48.82bn / US$13.29bn) into its banking sector to boost liquidity and enhance the lending capacity of financial institutions as part of continued efforts to support the sector amid the coronavirus pandemic.
Banks in the kingdom are performing well and indicators show their total assets at the end of the first quarter increased 14 per cent to 2.7 trillion riyals from a year earlier, the Saudi Arabian Monetary Authority said on Monday.
Credit facilities to the private sector in the first three months of the year rose 12 per cent and the average capital adequacy ratio reached 18.6 per cent, while the liquidity coverage ratio reached more than 200 per cent, the regulator said.
"These indicators positively reflect the continued pivotal role of commercial banks in the economic development of the kingdom," Sama said in a statement posted on its web site.
The move comes after the central bank's March announcement of a 50bn riyal stimulus package to shore up its private sector and offset the effects of Covid-19 on the country's economy.
Under its Private Sector Financing Support Programme, Sama extended about 30bn riyals to banks and financing companies to delay the payment of the dues of the financial sector from small and medium-sized enterprises for a period of six months, the regulator said at the time.
"The purpose of the programme is to mitigate the [effect] of precautionary coronavirus measures on the SME sector, specifically by reducing the burden of cash flow fluctuations, supporting working capital, enabling the sector to grow during the coming period and contributing to supporting economic growth and maintaining employment," the central bank said in March.
Concessionary finance for SMEs of up to 13.2bn riyals and loan guarantees worth 6bn riyals are also part of the package.
Sama's moves are part of several government initiatives intended to soften the economic blow of the pandemic on the kingdom amid a global slowdown.
The Covid-19 outbreak is the greatest challenge facing the world economy since the Great Depression of 1930s, and is set to tip it into the deepest recession to date, according to the International Monetary Fund.
The virus has infected more than 6.1 million people worldwide and killed more than 370,000 people, according to Johns Hopkins University, which is tracking the outbreak worldwide.
Covid-19 has also disrupted global supply chains, brought the travel industry to halt and forced governments to close borders.
The kingdom, the biggest oil exporter in the world, has started gradually opening up its economy after strict movement restrictions that led to the closure of all but essential businesses in the country.
In April, Saudi Arabia's King Salman approved a package of additional measures.
The government set aside 50bn riyals to speed up payments to the private sector, according to a government statement carried by the Saudi Press Agency said.
The government also announced a discount of 30 per cent on electricity bills for businesses in the commercial, industrial and agricultural sectors for a period of two months, with the possibility of extensions if needed.
The measures announced in April were in addition to 70bn riyals of economic support measures, including the payment of a minimum salary to self-employed drivers.
Last month, Saudi Arabia's finance minister Mohammed Al Jadaan said there was ample liquidity in the country's financial markets.
He also said the kingdom would take any measures needed to mitigate the economic damage caused by Covid-19 and lower oil prices.
Saudi Arabia reduced various expenditures in May and said it will suspend the cost of living allowance in June and triple VAT to 15 per cent from July.
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Bantamweight
Mohammed Adil Al Debi bt Moaz Abdelgawad
Welterweight
Amir Boureslan bt Mahmoud Zanouny
Featherweight
Mohammed Al Katheeri bt Abrorbek Madaminbekov
Super featherweight
Ibrahem Bilal bt Emad Arafa
Middleweight
Ahmed Abdolaziz bt Imad Essassi
Bantamweight (female)
Ilham Bourakkadi bt Milena Martinou
Welterweight
Mohamed Mardi bt Noureddine El Agouti
Middleweight
Nabil Ouach bt Ymad Atrous
Welterweight
Nouredine Samir bt Marlon Ribeiro
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Brad Stanton bt Mohamed El Boukhari
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What is the definition of an SME?
SMEs in the UAE are defined by the number of employees, annual turnover and sector. For example, a “small company” in the services industry has six to 50 employees with a turnover of more than Dh2 million up to Dh20m, while in the manufacturing industry the requirements are 10 to 100 employees with a turnover of more than Dh3m up to Dh50m, according to Dubai SME, an agency of the Department of Economic Development.
A “medium-sized company” can either have staff of 51 to 200 employees or 101 to 250 employees, and a turnover less than or equal to Dh200m or Dh250m, again depending on whether the business is in the trading, manufacturing or services sectors.
Sole survivors
- Cecelia Crocker was on board Northwest Airlines Flight 255 in 1987 when it crashed in Detroit, killing 154 people, including her parents and brother. The plane had hit a light pole on take off
- George Lamson Jr, from Minnesota, was on a Galaxy Airlines flight that crashed in Reno in 1985, killing 68 people. His entire seat was launched out of the plane
- Bahia Bakari, then 12, survived when a Yemenia Airways flight crashed near the Comoros in 2009, killing 152. She was found clinging to wreckage after floating in the ocean for 13 hours.
- Jim Polehinke was the co-pilot and sole survivor of a 2006 Comair flight that crashed in Lexington, Kentucky, killing 49.
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Entrepreneur: Started his own graphic design business
Favourite singer: Avril Lavigne
Favourite travel destination: Germany and Saudi Arabia
Family: Six sisters
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The biog
Most memorable achievement: Leading my first city-wide charity campaign in Toronto holds a special place in my heart. It was for Amnesty International’s Stop Violence Against Women program and showed me the power of how communities can come together in the smallest ways to have such wide impact.
Favourite film: Childhood favourite would be Disney’s Jungle Book and classic favourite Gone With The Wind.
Favourite book: To Kill A Mockingbird for a timeless story on justice and courage and Harry Potters for my love of all things magical.
Favourite quote: “We make a living by what we get, but we make a life by what we give.” — Winston Churchill
Favourite food: Dim sum
Favourite place to travel to: Anywhere with natural beauty, wildlife and awe-inspiring sunsets.
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