Suwaidi says banks have 'significant exposure' to Saad and Algosaibi groups

UAE banks have "significant exposure" to troubled Saudi groups Saad and Algosaibi, Central Bank Governor Sultan bin Nasser Al Suwaidi said yesterday.

He said the Saudi central bank could not keep its freeze on accounts linked to the two firms for ever and that Gulf countries must find a common and transparent solution to this issue as they are all affected.

"It's a big issue everywhere. All GCC countries are exposed. [The UAE banks' exposure] is significant," Al Suwaidi said, without detailing how much UAE banks were owed.

Suwaidi said he believed the groups' troubles were linked to the decline in asset prices because of global financial crisis.

The issue could cast doubt on all family businesses in the region if it was unresolved, he said.

"This case is a test for the common market and test for monetary union and the single currency," he said, adding that the UAE will ratify a law in at least four to six weeks to launch its first sovereign bond.

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