Saudi Arabia's banking system is among the safest in the world, according to the Banking Industry Country Risk Assessment (BICRA) published by Standard & Poor's. The ratings agency gave the Kingdom a BRICA rating of 2, upgraded from 3, making it the lowest-risk banking sector in the Middle East. Saudi Arabia was in the same group as Germany, France, Hong Kong, Singapore, Norway and Finland. Only Canada and Switzerland were ranked higher with a Group 1 rating. Both the US and the UK were ranked in Group 3, S&P said in a statement. BICRA ratings are scored on a scale from 1 to 10, ranging from the lowest-risk banking systems (1) to the highest-risk (10). S&P said Saudi banks “have adequate lending practices and underwriting standards, as well as a good track record in maintaining strong asset quality indicators.” The ratings agency also assigned an economic risk score of 3 to the Kingdom, reflecting its view that there is intermediate risk in economic resilience, low risk in economic imbalances, and intermediate risk in credit risk. This was again the best rating for the Gulf region, as the UAE was given a rating of 5, Bahrain scored 6, while Kuwait, Oman and Qatar were rated 4. All Gulf governments were assumed to be “highly supportive” towards domestic banking, the S&P report said. Elsewhere in the region, the UAE's BICRA rating was downgraded from Group 4 to 5.
