Saudi Banks Offered $4BN Bailout To Avoid Liquidity Crisis

Jon Alternative Media, Banking, Blogosphere, Economy, Government

In an effort to avoid a full-blown banking crisis, Bloomberg is reporting that the Saudi Arabian Monetary Agency, the Saudi central bank, has offered domestic lenders $4BN in discounted, 1-year loans to ease liquidity constraints. Banks in the kingdom are facing a cash squeeze as the government withdraws deposits and sells local-currency debt to fund the budget deficit. Monica Malik, chief economist at Abu Dhabi Commercial Bank PJSC, expects to see further easing in the coming days, saying:
“We expect to see further measures, such as possibly reducing the reserve requirement ratio or increasing the loan-to-deposit ceiling in the coming days.’

This post was published at Zero Hedge on Jul 31, 2016.