Banks in Saudi Arabia report a significant increase in profits. The robust performance of Saudi banks and the significant increase of profit are made from high-interest-rate, which has boosted bank profitability.

We are witnessing de-dollarization and forming new BRICS block who has influenced the increase in interest rates. Saudi Arabia are now full member of BRICS block who dumps U.S. dollars and started to trade in local currency. One of the factor who had triggered such rapid economic growth is high price of oil. Saudi Arabia moderate inflation has given the final boost to the profits of banking sector.

Saudi Central Bank (SAMA) released data compering last year profits with 2024 and the results show the significant increase in profits reaching ($1.96 billion) in May, the highest in 14 months.

The question that investors ask now is will there be a cut of interest rates?

Such a significant boosted of bank profits might not last indefinitely. Believing that such inflationary pressure eases Saudi Central bank could adjust its policy by lowing interest rates which would reduce bank profits.

Banks should prepare for declines in profitability because this in not the current new norm for high profits. Regarding such a high profit banks should use their financial positions to invest and make cost reductions.

Saudi Central Bank (SAMA) efforts to safeguard financial stability pays of and the Kingdom’s central bank has advanced the modernization of regulatory and supervision.

Significant progress has been made in developing financial safety net framework, encompassing bank, emergency liquidity assistance arrangements, and deposit protection fund. Saudi Arabas reports non-oil export like commodities, chemical products, vehicles, aircraft vessels, machinery, have risen by 12% in April 2024.

After all Saudi Arabia and its oil and gas production are the primary products that countries around the world need to develop their economy.