The Banking Executive Magazine - August 2024 Issue

Saudi Awwal Bank Saudi Awwal Bank BECOMES FIRST BANK IN SAUDI ARABIA TO RECEIVE LOCAL CONTENT CERTIFICATE With deposits marginally declining in June, the loans to deposits ratio (LDR) went up to 128.4%, com- pared to 127.9% in May. According to QNBFS, the services sector was the main driver for the second consecutive month, push- ing up the private sector loans in June. Services (contributes 32% to pri- vate sector loans) gained by 1.3% m-o-m (3.7% in 2024), while the real estate segment (contributes 20% to private sector loans) in- creased by 1% m-o-m (+4.3% in 2024) and general trade (con- tributes 22% to private sector loans) edged up by 0.2% m-o-m (+3% in 2024). However, consumption and others (contribute 20% to private sector loans) declined by 0.8% m-o-m (- 3.3% in 2024) in June. Total public sector loans moved marginally up m-o-m (3.8% in 2024) in June. The government in- stitutions’ segment (represents 66% of public sector loans) was the main driver for the public sector with an increase by 0.6% m-o-m (+4.7% in 2024), while the semi- government institutions segment went up by 1% m-o-m (-9.1% in 2024). However, the government segment (represents 29% of public sector loans) declined by 1.4% m-o-m (4.5% in 2024) in June. Outside Qatar loans dropped by 1.8% m-o-m (12.9% in 2024) in June. Public sector deposits fell by 2.4% m-o-m (7.1% in 2024) in June, driving the overall marginal de- cline in deposits. Looking at segment details, the government institutions’ segment (represents 56% of public sector deposits) dipped 3.2% m-o-m (6.4% in 2024), while the semi- government institutions’ segment went down 2.8% m-o-m (-13.9% in 2024) and the government seg- ment (represents 32% of public sector deposits) moved lower by 0.9% m-o-m (19.8% in 2024) in June. Private sector deposits made a mar- ginal gain of 0.1% m-o-m (+0.8% in 2024) in June 2024. The compa- nies and institutions’ segment moved up by 0.6% m-o-m (-4.3% in 2024). However, the consumer segment edged down by 0.3% m- o-m (+5.3% in 2024). Non-resident deposits jumped by 4.3% m-o-m (+10.0% in 2024) in June. The banking sector's loan provi- sions to gross loans was at 4.1% in June, compared to 3.9% in May 2024. Liquid assets to total assets moved higher to 30.7% in June, compared to 30.1% in May 2024. An analyst told Gulf Times, “The key highlights for the month of June are the increase in total assets by 1.2%, which rose mainly due to the increase in both domestic credit and domestic investments (on the domestic assets side) and a spike in due from banks abroad on the foreign assets side. “The 0.4% increase in the overall loan book resulted mainly from a 1.3% gain in June from the services segment, signifying the further strengthening of tourism sector. Even as overall deposits were mar- ginally down for the month, non- resident deposits witnessed a significant rise by 4.3% in June.” ISSUE 188 AUGUST 2024 the BANKING EXECUTIVE 41 Saudi Awwal Bank, one of the lead- ing banks in the Kingdom of Saudi Arabia, has become the first bank in the country to have received a ‘Local Content Certificate’ from the Local Content & Government Procurement Authority (LCGPA). The achievement reflects “SAB's” dedication to fostering local develop- ment and supporting the Saudi Vi- sion 2030 for sustainable growth. It is part of the bank's efforts to stay in tune with global standards on envi- ronmental, social, and governance (ESG) practices. Regarding the recognition, Ghada AlJarbou, Chief Operating Officer at SAB, said: "Obtaining this certificate is an excellent achievement. As it re- flects the bank’s commitment to per- sistently improving performance across all its areas to reach its strate- gic goals and contribute effectively to the Saudi Vision 2030 and the devel- opment of the financial sector." Local content plays a crucial role in developing non-oil sectors and GDP, and the Kingdom's leadership has taken many steps toward enhancing and developing it. This recognition testifies to “SAB's” exceptional services and highlights its strength and diversity in catering to its customers' needs with effi- ciency and innovative solutions.