IslamicFinance.de

The latest #Saudi Arabian survey conducted by Riyali Financial Literacy Program shows that more than 86% of the respondents have suffered from some form of financial distress. This high percentage sheds light on the importance of spreading financial awareness to manage a stable financial life. The survey also showed that most of the commitments that the participants failed to fulfill were finance installments (44%), followed by borrowing from friends and family (34%), and then credit card payments (22%). In addition to that, the survey highlighted another noticeable problem, which is the high debt burden ratio where monthly installments of 42% of the participants exceeded 60% of their monthly salary. In this regard, the Saudi Arabian Monetary Agency (SAMA) has set the limit at 33% for the monthly debt burden that a customer can afford, to be able to successfully pay off debts.

According to a recent Fitch Ratings report, major Saudi banks continue to report liquidity coverage ratios (LCRs) above 100% despite a 30% outflow of government-related deposits. The banks’ ability to withstand such a shock demonstrates that their liquidity positions are resilient. The Saudi Arabian Monetary Agency (SAMA) released $5.3 billion (20 billion Saudi riyals) of government-related deposits into the banking sector yesterday. According to Fitch Ratings, Saudi banks will continue to adopt careful liquidity management strategies in order to protect their LCRs from falling below current levels.

Saudi companies willing to become public holding firms have slowed down the process, following a drop in prices of new companies listed in local share markets dealings. The forbearance of Saudi companies affected the region’s market. Saudi share market concluded the first week sessions with a slight drop and it closed at 6,212 points amid USD613.3 million (SAR2.3 billion) monetary liquidity, which is considered the least in five years. Saudi Arabian Monetary Agency (SAMA) continued its positive movements to enhance performance of local insurance companies.

Saudi Arabian Monetary Agency (SAMA) is expected to obtain a full membership at the Financial Action Task Force (FATF) in June 2018. At the 8th Compliance & Anti Money Laundering Seminar in Saudi Arabia SAMA Vice Governor Abdulaziz Al-Furaih said several new assessments have emerged including the set of recommendations by FATF and the MENA Financial Action Task Force (MENA FATF). Thomson Reuters Managing Director Nadim Najjar noted that compliance costs are set to increase in 2016.

The long awaited regulations on real estate financing, leasing and supervision of financial companies are now eventually being issued by the Saudi Arabian Monetary Agency (SAMA). Meanwhile, Saudi Arabia is getting ready to open up its mortgage market. The public now has to review the draft regulations. Comments and observations are to be submitted within 30 days of its publication. The regulations can be found on SAMA's website. The executive vice president of Capitas Group International - Nasser Nubani - explains that the draft mortgage regulations are a clear indication of SAMA's careful approach and striving to defend against problems due to lax regulation standards.

Saudi Arabia's central bank will have a bigger role in the supervision of the country's financial sector as the kingdom weighs opening up its stock market to direct investments by foreigners.
The country's Capital Market Authority (CMA) signed a cooperation agreement with the central bank or Saudi Arabian Monetary Agency (SAMA) to coordinate supervision of the financial sector in order to improve its stability.
According to the agreement, the two entities will work together in the supervision of corporate governance, risk management measures, initial public offerings (IPOs), sukuk issuance and merger and acquisition regulations as well as the exchange of information.