The Governor of the Saudi Central Bank, Ayman Al-Sayyari, confirmed that the banking system in the Kingdom is solid and capable of absorbing any future shocks.
Al-Sayyari added, in an interview with Al-Arabiya TV, that the capital adequacy rate for Saudi banks is approximately 20%, and the liquidity coverage rate is about 180%, according to figures until the end of 2022.
“The rate of coverage of non-performing loans is 147%, and the banking sector in Saudi Arabia is known for its strength, high efficiency of its capital, high liquidity, and low percentage of non-performing debts,” Al-Sayyari said.
He pointed out that the capital adequacy rate reached about 19.94% at the end of 2022, and the measurement of liquidity cover reached 180%, which is higher than the limit required by “Basel”, which is a guiding reference that sets controls.
Al-Sayyari pointed out that “Non-performing loans in the Saudi banking sector are 1.8%, and the level of coverage for non-performing loans is 147%. The situation for the Saudi banking sector is reassuring, and this enhances its ability to absorb any crises that may occur in the future, and we are among the first banks to implement Basel requirements.”
He stressed that the Central Bank of Saudi Arabia conducts periodic reviews with each bank separately to ensure the safety of capital and the adequacy of liquidity levels.