Bank deposits in Saudi Arabia grow by 9.1% year-on-year in October 2024

Bank deposits of banks operating in the Kingdom in October 2024 recorded a growth of 9.2% on an annual basis, an increase equivalent to 228 billion riyals, rising to 2709 billion riyals compared to 2481 billion riyals at the end of October 2023. The increase came as a result of the increase in “time and savings” deposits as well as “demand” deposits by rates of increase of 15.3% and 8.6% respectively, while the balance of “current” deposits decreased by a decrease of 4.3%. Liquidity levels remained sufficient as the growth in the deposit base continued with a noticeable shift to time and savings deposits, which is reflected in the tendency of depositors to invest their money in interest-bearing savings vessels, benefiting from the prevailing interest rates, although they declined twice during the year. 2024 The last of which was on November 7, in light of the decision of the Saudi Central Bank “SAMA” to reduce the repurchase agreement “repo” rate by 25 basis points to 5.25%, and reduce the reverse repurchase agreement “reverse repo” rate by 25 basis points to 4.75%, in line with “SAMA’s” goal of maintaining monetary stability.

On a monthly basis, it is noted that the balance of bank deposits decreased by 0.4%, with a value of a decline of 10 billion riyals, reaching 2719 billion riyals in September 2024.

Bank deposits represent the main source of financing in banks, as they accounted for 62% of the total liabilities due to banks, amounting to about 4,366.9 billion riyals in October 2024, compared to 3,915.3 billion riyals in October 2023. Deposits represented 63.4% of the total liabilities, a decrease of 1.4%, which reflects the decline in the ratio of deposits to liabilities and the banks’ tendency to search for other non-traditional sources of financing in addition to deposits, such as some banks resorting to issuing sukuk, especially in light of the expansion in granting thriving credit in light of the huge boom in projects in the Kingdom, which is confirmed by the achievement of bank credit growth of 12.46% on an annual basis, so that the balance of credit granted by banks at the end of October 2024 amounted to about 2,883.5 billion riyals, compared to 2,563.9 billion riyals, an increase of 319.57 billion riyals on an annual basis, which is higher than the growth rate in bank deposits, which amounted to 9.2% for the same period.