KSA firms’ market cap hits SR1.75 trillion in 4 years

RIYADH: Market capitalization of the Saudi financial sector (listed firms) registered compound annual growth rate (CAGR) of 9 percent to reach $467.5 billion (SR1.75 trillion) in a four-year period (2009-2013), local media said quoting Saudi Arabian Monetary Agency (SAMA) Gov. Fahad Al-Mubarak.
The number of listed companies in the Saudi equity market jumped from 135 to 163 in the same period, Al-Mubarak was quoted as saying.
Similarly, assets of the Saudi banks registered CAGR of 8.4 percent during the period, which was mainly attributed to the increased volume of deposits and credits, he said.
In a wide-ranging interview with Oxford Business Group (OBG), Al-Mubarak expressed confidence over the resilience of the Saudi economy to lower oil prices in the medium term thanks to years of strong growth of the Saudi economy, which registered an average annual growth of 5.5 percent.
The SAMA chief said efforts of the Saudi government to boost the financial sector were moving steadily thanks to major developments, notably the growth of non-banking sector and increased mobilization of resources.
Al-Mubarak referred to other positive moves in this context such as the opening of Saudi equity market to foreign investments in the current year.
Referring to the impact of oil prices, the SAMA chief said the higher oil prices earlier had improved the financial position of the Kingdom where it allowed the government to narrow the ratio of public debts to the gross domestic product (GDP) to 1.6 percent in 2014, compared to 97 percent in 2002. The effective contribution came from nonoil sector, which grew by 6.8 percent compared to 1.6 percent to oil sector.
In regards to the 2015 state budget, he said it contained a record spending on projects worth $229.3 billion (SR860 billion), 51.2 percent of which was allocated for health, education and infrastructure projects.
Al-Mubarak stressed SAMA’s plans in boosting the role of the small and medium enterprises (SMEs) in the Saudi economy. Among many steps taken in this regard is how to help the SMEs get credit smoothly and set up units in the banks, which are specialized in SME area to this end, he said.