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Saudi Arabia banks likely to benefit from increase in US interest rates

: Wednesday, August 27 - 2014 @ 00:17

Banks in Saudi Arabia, whose currency is pegged to the dollar, are likely to benefit from the eventual increase in U.S. interest rates, which will widen their margins, Reuters reported. Federal Reserve Chair Janet Yellen indicated on Friday that the Fed might have to raise rates sooner and more quickly than expected. According to Naveed Ahmed, investment director at Gulf Finance House in Bahrain, Saudi bank shares are also more liquid compared to stocks in many other sectors, and are thus better positioned to capture the positive momentum from the planned opening of the market to direct foreign investment. Saudi Arabia’s index has risen 12% since the Capital Market Authority said in late July that it would allow direct foreign ownership of local stocks early next year. On Thursday, the CMA published draft regulations which would cap total foreign ownership at 10% of the market’s value and restrict foreign holdings of individual stocks.

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Wednesday, August 27- 2014 @ 0:17 UAE local time (GMT+4) Replication or redistribution in whole or in part is expressly prohibited without the prior written consent of Mediaquest FZ LLC.

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