| DUBAI, March 28
DUBAI, March 28 Growth in Saudi Arabian bank
lending almost halted in February, central bank data showed on
Tuesday, with companies holding back from investment in the face
of stubbornly low oil prices and concern over government
Bank lending to the private sector showed year-on-year
growth of only 0.3 percent in February, slowing from 1.8 percent
in January and down sharply from the 10 percent registered a
Bankers say part of the reason for the lending slowdown is
that state money is flowing more freely through the economy than
it was for most of last year, when the government stopped paying
many of its bills as low oil prices took a heavy toll on public
The lack of government payments forced companies to draw on
credit facilities for operating funds, inflating loan growth. In
the past few months, Riyadh has resumed bill payments, easing
the pressure on companies.
However, companies remain nervous about investing as the
government plans fresh austerity measures in coming months,
including domestic fuel price rises and a tax on tobacco and
sugary drinks, which will increase companies' costs and weigh on
In a sign of sluggish consumer spending, cash withdrawals
from automated teller machines dropped to the lowest level for
more than a year in February, the central bank data showed,
while the government continued to draw down foreign assets to
help pay its bills.
Net foreign assets at the central bank fell by $9.8 billion
from the previous month to $506.9 billion, their lowest level
since August 2011. They reached a record high of $737 billion in
August 2014 before starting to fall.
Among those assets, most of which are believed to be in U.S.
dollars, deposits with banks abroad dropped by $5.2 billion to
$95.1 billion. Investments in foreign securities shrank by $4.3
billion to $355.3 billion.
(Editing by David Goodman)