Riyadh – Mubasher: The decline in Saudi Interbank Offered Rate (SAIBOR) is credit positive as it indicates the availability of liquidity, Moody's Investors Service said.
The rating firm noted that liquidity pressures among Saudi banks are easing after the past two years of deposit outflows and increased funding costs as a result of falling oil prices and associated government revenues.
Moody's Investors Service added that the SAIBOR decline followed Saudi Arabia’s $17.5 billion international sovereign bond issuance on 19 October.
SAIBOR fell to 2.19% from 2.39% to reach its lowest level since June 2016 and reverse the upward trend of the past 12 months, according to the report.
Moody's Investors Service expected some of the proceeds from that issuance to flow into local banks either directly, through public-sector deposits, or indirectly in the form of corporate deposits.
