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Saudi Arabia Approves Licensing of New Digital Bank

Buildings are seen in Riyadh, Saudi Arabia February 16, 2021. (Reuters)
Buildings are seen in Riyadh, Saudi Arabia February 16, 2021. (Reuters)
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Saudi Arabia Approves Licensing of New Digital Bank

Buildings are seen in Riyadh, Saudi Arabia February 16, 2021. (Reuters)
Buildings are seen in Riyadh, Saudi Arabia February 16, 2021. (Reuters)

Saudi Arabia’s central bank announced on Tuesday that the government has approved the licensing of a third digital bank, called D360 Bank, with a capital of 1.65 billion riyals ($440 million).

It added that the Kingdom’s Public Investment Fund (PIF) was part of the consortium of companies and investors launching the new lender.

The creation of digital banks in the Kingdom is part of the Financial Sector Development Program within Saudi Vision 2030, which seeks to enable financial institutions to support the growth of the private sector, and open the way for new companies to provide financial services.

Two other local digital banks were granted the license to operate in the Kingdom last year, bringing the total number of licensed banks to 35 (11 local, three local digital banks, and 21 foreign bank branches), which reflects the strength, sustainability and attractiveness of the banking sector in particular, and the Saudi economy in general.

The Saudi Central Bank (SAMA) has been actively engaged in keeping pace with the latest developments in the financial industry and in line with the objectives of the Financial Sector Development Program that seeks to develop the digital economy; enable financial institutions to support private sector growth and provide opportunities to new companies and start-ups.

Meanwhile Reuters reported that the Saudi PIF held nearly $56 billion worth of US-listed stocks as of December last year, up from $43.4 billion at the end of September, boosted by the increased value of electric car maker Lucid.

On Sunday the government said Crown Prince Mohammed bin Salman had transferred 4% of Saudi Aramco shares worth $80 billion to PIF.

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IMF Approves Third Review of Sri Lanka's $2.9 Bln Bailout

Peter Breuer, Senior Mission Chief for Sri Lanka at the IMF along with Katsiaryna Svirydzenka, Deputy Mission Chief for Sri Lanka at the IMF and Martha Tesfaye Woldemichael, Deputy Mission Chief for Sri Lanka at the IMF, attend a press conference organized by the International Monetary Fund (IMF) in Colombo, Sri Lanka, November 23, 2024. REUTERS/Thilina Kaluthotage
Peter Breuer, Senior Mission Chief for Sri Lanka at the IMF along with Katsiaryna Svirydzenka, Deputy Mission Chief for Sri Lanka at the IMF and Martha Tesfaye Woldemichael, Deputy Mission Chief for Sri Lanka at the IMF, attend a press conference organized by the International Monetary Fund (IMF) in Colombo, Sri Lanka, November 23, 2024. REUTERS/Thilina Kaluthotage
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IMF Approves Third Review of Sri Lanka's $2.9 Bln Bailout

Peter Breuer, Senior Mission Chief for Sri Lanka at the IMF along with Katsiaryna Svirydzenka, Deputy Mission Chief for Sri Lanka at the IMF and Martha Tesfaye Woldemichael, Deputy Mission Chief for Sri Lanka at the IMF, attend a press conference organized by the International Monetary Fund (IMF) in Colombo, Sri Lanka, November 23, 2024. REUTERS/Thilina Kaluthotage
Peter Breuer, Senior Mission Chief for Sri Lanka at the IMF along with Katsiaryna Svirydzenka, Deputy Mission Chief for Sri Lanka at the IMF and Martha Tesfaye Woldemichael, Deputy Mission Chief for Sri Lanka at the IMF, attend a press conference organized by the International Monetary Fund (IMF) in Colombo, Sri Lanka, November 23, 2024. REUTERS/Thilina Kaluthotage

The International Monetary Fund (IMF) approved the third review of Sri Lanka's $2.9 billion bailout on Saturday but warned that the economy remains vulnerable.
In a statement, the global lender said it would release about $333 million, bringing total funding to around $1.3 billion, to the crisis-hit South Asian nation. It said signs of an economic recovery were emerging, Reuters reported.
In a note of caution, it said "the critical next steps are to complete the commercial debt restructuring, finalize bilateral agreements with official creditors along the lines of the accord with the Official Creditor Committee and implement the terms of the other agreements. This will help restore Sri Lanka's debt sustainability."
Cash-strapped Sri Lanka plunged into its worst financial crisis in more than seven decades in 2022 with a severe dollar shortage sending inflation soaring to 70%, its currency to record lows and its economy contracting by 7.3% during the worst of the fallout and by 2.3% last year.
"Maintaining macroeconomic stability and restoring debt sustainability are key to securing Sri Lanka's prosperity and require persevering with responsible fiscal policy," the IMF said.
The IMF bailout secured in March last year helped stabilize economic conditions. The rupee has risen 11.3% in recent months and inflation disappeared, with prices falling 0.8% last month.
The island nation's economy is expected to grow 4.4% this year, the first increase in three years, according to the World Bank.
However, Sri Lanka still needs to complete a $12.5 billion debt restructuring with bondholders, which President Anura Kumara Dissanayake aims to finalize in December.
Sri Lanka will enter into individual agreements with bilateral creditors including Japan, China and India needed to complete a $10 billion debt restructuring, Dissanayake said.
He won the presidency in September, and his leftist coalition won a record 159 seats in the 225-member parliament in a general election last week.