Saudi Arabia’s banking sector is expected to witness positive performance in 2021, KPMG said in a recent report.
In the report, titled Banking Perspectives 2021, KPMG said this is in contrast to a shaky outlook in the corresponding period last year.
The sector’s 2021 performance will be supported by government reforms, halt in credit losses, stable liquidity, stronger capital adequacy ratio (CAR), and transformational changes.
KPMG reported that the 11 Tadawul-listed banks stayed resilient in 2020, reflecting signs of recovery since uncertainties evolved in March 2020.
“A cursory glance at the 2020 financial highlights of the Saudi Arabian banking sector reveals the unmissable effects of COVID-19. However, there is absolute unanimity that the full year numbers are a significantly better end to a year than many would have anticipated this time last year,” said Ovais Shahab, head of financial services at KPMG Saudi Arabia.
“Banks are reporting a strong capital and liquidity base, and increasing housing demand, house mortgage is witnessed double-digit growth,” he added.
According to the data available with Argaam, Saudi-listed banks posted a 23% decline year-on-year (YoY) in aggregate net profit to SAR 34.7 billion by the end of 2020, compared to SAR 45 billion a year earlier.
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