The aggregate income of Saudi Arabia’s top ten banks jumped by 34 percent in the first quarter compared to the previous three months, Alvarez & Marsal (A&M) said in a report.
The banks benefited from improving macroeconomic conditions, buoyant capital markets and a marked decline in impairments, A&M’s Saudi Arabia Banking Pulse revealed. It could set the stage for more mergers in the sector according to the consultancy.
“Looking ahead, credit growth is likely to be driven by continuous strength in mortgage lending and a pick-up in corporate credit demand in the second half of 2021, as the economic activity continues to improve,” said Asad Ahmed, A&M managing director and head of Middle East financial services.
“Corporate lending is expected to gain traction as the Public Investment Fund’s (PIF) plans to invest $40 billion into the economy annually until 2025, to support business activity.”—AN