RIYADH, 19 March 2006 — The Saudi Minister of Finance Dr. Ibrahim Al-Assaf signed here the small and medium enterprises (SME) Financing Scheme Guarantee for SABB yesterday in presence of Abdullah Al-Hugail, SABB chairman.
SABB obtained the guarantee during a ceremony for signing of guarantees issued to local banks providing finances to small and medium enterprises.
The guarantee is the first of its kind under the SME Finance Scheme, which has been established by the Ministry of Finance and local banks. The scheme guarantees to local banks a share of the finance extended to small and medium enterprises.
The scheme aims at enabling small and medium enterprises to obtain the necessary finance in line with Shariah principles to develop and expand their activities as well as to encourage banks to finance this category after ascertaining their economic feasibility.
“The program contributes to the upgrading of local enterprises competition capabilities and positively reflects on the Saudi economy in view of the job opportunities provided, training and recruitment of nationals as well as substitution of imported commodities with local products,” said Al-Hugail.
“This is in addition to increasing the capabilities of financed enterprises to produce innovative products and services of high quality,” he added.
The SME Finance Scheme management has agreed to issue a guarantee favoring SABB guaranteeing 50 percent of the value of finance provided by the bank to a firm active in the environment protection fields.
SABB has recently obtained the first guarantee by the Saudi Industrial Development Fund, which manages SME finance scheme, in consideration of financing a national enterprise that is involved in recycling of industrial remains. The scheme was financed through Murabaha, a product of SABB Amanah Islamic Banking Services for corporations.
