Saudi Banks Show Strong Liquidity and Capital Buffers

The Saudi banking sector continues to show strong financial health, with robust liquidity, solid capital buffers, low levels of non-performing loans, and steady credit growth through 2025 and 2026. The latest sector metrics point to a stable and well-funded banking system operating comfortably within regulatory thresholds.

Broad money supply (M3) reached about SAR 3.30–3.38 trillion in 2026, reflecting continued growth in banking-sector liquidity and lending. Total bank credit rose to roughly SAR 3.42 trillion by June 2026, up about 7.3% year-on-year, while total deposits climbed to around SAR 3.13 trillion, an increase of 8.9% over the same period. Total bank assets stood near SAR 5 trillion in early 2026, supported by strong demand for corporate financing.

Liquidity indicators remain healthy. The sector's liquidity coverage ratio (LCR) is generally well above 100%, averaging around 140–160%, while the loan-to-deposit ratio (LDR) stays below the 90% regulatory cap, with major banks reported below about 85%. Aggregate capital adequacy ratios (CAR) sit near 20%, comfortably above the minimum requirements under Basel III/IV.

A countercyclical capital buffer (CCyB) of 1.0%, announced in May 2025, became effective in May 2026, raising required capital in line with financial cycle conditions. Meanwhile, non-performing loan ratios remain at historically low levels of around 1.0–1.6% of total loans, with coverage ratios typically above 150%, signaling low credit risk and strong provisioning.

On the policy side, the repo rate stood at 4.25% in late 2025, with the reverse repo rate at 3.75%, forming the basis for short-term liquidity operations. For residents and businesses in Riyadh, Jeddah and across the Kingdom, these figures point to a resilient banking system capable of supporting lending, savings, and continued economic expansion under Saudi Vision 2030.

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