The International Finance Corporation (IFC), the private sector arm of the World Bank Group, has signed a memorandum of understanding with Saudi Arabia’s Riyad Bank (RB), one of the largest banks in the kingdom, whereby IFC will advise to the bank on developing its small and medium enterprise (SME) banking operations.
The project will be managed by IFC’s technical assistance facility, the Private Enterprise Partnership for the Middle East and North Africa (PEP-MENA) and will coordinate with Riyad Bank to develop and fine-tune its product offerings, credit risk management, and delivery more effectively channels to meet the banking needs of small businesses in the country.
“This joint project between Riyad Bank and IFC is yet another example of how PEP-MENA is contributing to the expansion of the range of services offered by the banking sector to SMEs in the region. I am very pleased that this collaboration will further strengthen the existing ties between our two institutions,” says Sami Haddad, IFC’s director for the Middle East and North Africa.
“Riyad Bank has entered into this agreement with IFC with the aim of strengthening and expanding our business in the small and medium enterprise sector in the kingdom. We look forward to implementing a successful project in cooperation with the IFC,” adds Talal Al Qudaibi, president and CEO of Riyad Bank.
Riyad Bank is one of the largest banks in Saudi Arabia, commanding a market share of 12% in total assets. It was established in 1957 and currently has over 190 branches in the kingdom. Total assets exceed US$19bn, and the net profit for 2004 was US$535mn.
PEP-MENA is IFC’s technical assistance facility that supports private sector development in the Middle East and North Africa. It focuses on improving the business-enabling and regulatory environment in the region; strengthening the financial sector; promoting the growth of small and medium enterprises and their support services, such as business organisations and consulting firms; helping restructure and privatise state-owned enterprises; and developing viable private sector and public-private partnership projects, especially in infrastructure.