Saudi Gazette

JEDDAH — The State Bank of India, Jeddah, will soon cease operation as the Saudi Arabian Monetary Authority (SAMA) has granted the go ahead for it. SAMA, the central bank, announced on Thursday that it has approved the request of SBI to suspend its banking operations in the Kingdom in view of a change in strategic plans of the parent bank pertaining to its overseas branches.

SBI Jeddah, which had been licensed to start operations in the Kingdom on Oct. 3 2005, is expected to exit the Saudi banking market by the end of the year 2017.

SAMA decided to approve the Indian bank’s request in accordance with article 11 of the Banking Control Law and this will be after fulfilling the statutory requirements and taking into account of the rights of customers and depositors.

SAMA has called on all customers and depositors of SBI Jeddah to exercise their rights guaranteed by the Saudi banking regulations to file a complaint with the SAMA Customer Protection Department in the event of any violation of their rights from the part of the Indian bank.

The complaints can be registered after contacting the toll free number (800 125 6666) or online contact with SAMA’s website or visit customer service division of the central bank’s headquarters.

There are 14 branches of licensed foreign banks in the Kingdom, the most recent of which was the branch of the Tokyo Bank of Japan, which was licensed in Dec. 2016. In May, the Council of Ministers granted license to establish a banking company under the Bahrain-based Gulf International Bank. SAMA has recently granted license to the branch of the Emirates National Bank of Dubai to open three additional branches in the Kingdom.

SBI is India’s largest bank and this banking behemoth has 20 percent of market share in deposits and loans among Indian commercial banks. With the recent merger of five of its associate banks, SBI will enter the league of top 50 global banks with 420 million customers, and more than 24,000 branches. It is under going a massive consolidation exercise locally as well as globally to reap the benefits of economies of scale.