What influences bank lending in Saudi Arabia ?
Author
Source
Issue
Vol. 27, Issue 2 (31 Jan. 2020), pp.125-155, 31 p.
Publisher
Islamic Development Bank (IDB) Islamic Research and Training Institute (IRTI)
Publication Date
2020-01-31
Country of Publication
Saudi Arabia
No. of Pages
31
Main Subjects
Abstract EN
Purpose -Determinants of credit growth in Saudi Arabia are investigated.
Design/methodology/approach -A panel approach is applied to macroeconomic and bank-level data spanning 2000 -15.
Findings -Bank lending is supported by strong bank balance sheet conditions (high capital ratio, and growth of NPL provisioning and deposits), and higher growth of both oil prices and non-oil private sector GDP.
Lower bank concentration also helps, likely through greater competition, so does stronger institution.
Consistent with the literature, lending by Islamic banks may be more responsive to economic activity.
Lending remained robust in 2015 despite oil prices having declined, helped by strong bank balance sheets and as banks reduced their holdings of “excess liquidity”.
To support bank lending in the period ahead, bank balance sheets need to remain strong.
Fiscal adjustment and a reduced reliance on banks to finance the budget deficit would support credit provision to the private sector.
Originality/value - The paper is first to analyze in detail determinants of bank lending in Saudi Arabia applying a panel approach to bank level data, and draws critical policy implications.
American Psychological Association (APA)
Miyajima, Ken. 2020. What influences bank lending in Saudi Arabia ?. Islamic Economic Studies،Vol. 27, no. 2, pp.125-155.
https://search.emarefa.net/detail/BIM-1241536
Modern Language Association (MLA)
Miyajima, Ken. What influences bank lending in Saudi Arabia ?. Islamic Economic Studies Vol. 27, no. 2 (Jan. 2020), pp.125-155.
https://search.emarefa.net/detail/BIM-1241536
American Medical Association (AMA)
Miyajima, Ken. What influences bank lending in Saudi Arabia ?. Islamic Economic Studies. 2020. Vol. 27, no. 2, pp.125-155.
https://search.emarefa.net/detail/BIM-1241536
Data Type
Journal Articles
Language
English
Notes
Includes appendix : p. 152-155
Record ID
BIM-1241536