Bad debts by Saudi Banks hit close to US$7 billion
Dr. Saeed Al-Sheikh, Chief Economist at National Commercial Bank has disclosed that the value of bad debts accumulated by the Saudi banks during the past two years amounted to SR25 billion (US$6.7 billion). Sheikh said in a press conference that the pace of bad debts by Saudi banks has slowed down during 2010 as the percentage of bad debt exceeded 100 percent.
It should be mentioned that last week the Kingdom’s central bank governor said local banks had taken enough measures against bad loans and are poised for growth as lending will accelerate this year. Lending growth stalled in December 2009 but it has been picking up slowly over the past few months. Most Saudi banks exceeded average analyst forecast with net profit in the fourth quarter of 2010.