Saudi banks lent more to the private sector in September, and the credit boom is still gathering pace.
Driving the news: Saudi bank lending to the private sector rose 6.04% year on year by the end of September. According to Al Arabiya Business calculations based on Saudi Central Bank (SAMA) data, the increase totals SAR 189.45 billion ($50.52 billion).
Why it matters: Private-sector credit funds Vision 2030 projects, small businesses and household spending. Therefore, it shows how fast the non-oil economy is growing.
Banks’ claims on the private sector reached SAR 3.324 trillion ($886.53 billion). A year earlier, the figure stood at SAR 3.135 trillion ($836 billion). The momentum continued month to month as well. Claims edged up about 0.8% from SAR 3.297 trillion ($879.11 billion) at the end of August.
Meanwhile, lending in the first nine months of 2026 grew 5.63%. That adds SAR 177.05 billion ($47.21 billion) to the SAR 3.147 trillion ($839.31 billion) recorded at the end of 2025.
What Banks are Lending
Zoom in: Bank claims on the private sector combine credit with investments in private securities. Credit leads the growth by a wide margin. Bank credit to the private sector climbed 6.2% year on year. Loans, advances and overdrafts make up almost all of it, and they grew 6.19%. Discounted bills rose faster, at 7.67%. By contrast, investments in private securities inched up just 1.58%.
The public sector also borrowed more. Banks’ claims on government and semi-government entities grew 9.75%, which shows that state-linked borrowers keep expanding their financing alongside private firms.
By the numbers:
- Private-sector claims: SAR 3.324 trillion ($886.53 billion), up 6.04% year on year.
- Annual increase: SAR 189.45 billion ($50.52 billion).
- Nine-month growth: 5.63%, or SAR 177.05 billion ($47.21 billion).
- Monthly change: up about 0.8% from SAR 3.297 trillion ($879.11 billion) in August.
- Bank credit to the private sector: SAR 3.215 trillion ($857.41 billion), up 6.2%.
- Loans, advances and overdrafts: SAR 3.193 trillion ($851.52 billion), up 6.19%.
- Discounted bills: SAR 22.09 billion ($5.89 billion), up 7.67%.
- Private securities: SAR 109.19 billion ($29.12 billion), up 1.58%.
- Public-sector claims: SAR 963.26 billion ($256.87 billion), up 9.75%.
- Total bank credit: SAR 3.5 trillion ($933.45 billion), up 7.3%.
A Banking System Built for Growth
The big picture: Saudi Arabia’s lending boom rests on strong demand. Vision 2030 projects need heavy financing, so banks sit at the center of the Kingdom’s investment drive. Loans to the private sector and non-financial government institutions rose 7% to more than SAR 3.54 trillion ($944 billion) by the end of July. The private sector accounted for more than 92% of that total.
S&P Global Ratings also sees momentum ahead. The agency expects lending growth of 10% in 2026, driven by Vision 2030 financing needs. Small and midsize enterprises (SMEs) show the shift clearly. Bank credit to SMEs reached SAR 427.7 billion ($114 billion) in the third quarter of 2025. That figure equals 11% of private-sector lending, up from SAR 311.8 billion ($83.1 billion), or 9.1%, a year earlier.
Profits follow the credit. Seven listed banks reported combined profits of SAR 61.06 billion ($16.28 billion) for the first nine months of 2026, up 7.4%, according to Annahar. In addition, an analyst quoted by Asharq Al-Awsat expects sector profits to approach SAR 100 billion ($26.7 billion) this year. That compares with about SAR 90 billion ($24 billion) in 2025.
Banks are also adapting how they fund growth. Government deposits reached 32% of total deposits by November 2025, up from almost 20% in 2020, according to S&P Global. Furthermore, lenders now tap international markets and private capital to keep pace.
Analysts continue to watch deposit growth, margins and credit-loss provisions. Still, the Kingdom’s Financial Sector Development Program aims to deepen financial institutions’ support for private-sector growth. It also encourages fintech, digital banking and stronger competition.
What’s next: Lending growth should stay solid as Vision 2030 projects move forward. Falling interest rates could lower funding costs and encourage more borrowing. As a result, banks will likely lean further on diversified funding, SME lending and new financing partners.
The next SAMA bulletin will show whether credit keeps its steady climb into the final quarter of 2026.
