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- Dubai 05:24 06:42 12:10 15:09 17:32 18:50
Saudi Arabia’s banks have registered nearly SAR7 billion (Dh6.9bn) in bad loans in 2007 after more than 180,000 people failed to pay back debt, a Saudi newspaper reported.
The bad loans accounted for nearly 3.8 per cent of the total personal credits of around SAR197bn provided by the Saudi banks last year, Aleqtisadiah daily said.
The level was much higher than the bad loans of around SAR5bn recorded in 2006, but is expected to decline in 2008 following the introduction of several curbs on lending by the Saudi Arabian Monetary Authority.
The report said the surge in bad loans was a “natural result” of a sharp growth in domestic credits as the Gulf Kingdom is passing through an economic boom because of high oil prices.
From SAR10bn in 2000, personal loans rocketed to SR170bn in 2005 and continued their rise in the following years.
Saudi Arabia has an oil-based economy and it possesses 25 per cent of the world’s proven oil reserves.
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