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  • 6.1 Lending Bank

    7.A bank that wishes to participate in an IPO as a Lending Bank shall apply, as a minimum, the following:
     
     a.The policy and procedures related to the financing of Securities shall be documented and adequately cover all the main risks that the bank may be exposed to.
     
     b.Adhere to credit policies approved by the bank, and limit the total Exposures in each IPO within an amount that does not exceed the bank's ability to meet its obligations on the settlement date.
     
     c.Follow the internal policies of guarantees, or any other related policies.
     
     d.Conduct a comprehensive analysis, prior to financing the purchase of Securities, that at least includes the potential impact on the Capital Adequacy Ratio (CAR), Loan-to-Deposit Ratio (LDR), SAMA Liquidity Ratio, Liquidity Coverage Ratio (LCR), the Net Stable Funding Ratio (NSFR), Leverage Ratio, Large Exposure limits, and Exposures limits to Related Parties, taking into account the relevant instructions issued by SAMA.
     

    • 6.1.1 Lending Limits

      8.The Leverage Ratio for retail subscriptions shall not exceed 50% of the amount to be subscribed for each Retail Subscriber, with a maximum financing limit not exceeding 2 million Saudi Riyal.
       
      9.Both High-Net-Worth Subscribers and Legal Entities are excluded from Paragraph 8 above. However, the bank shall follow its approved credit standards, and limit the total Exposures to an amount within the risk appetite of the subscriber (credit lines).
       
      10.Banks shall not exceed the Exposures limits stipulated in the relevant instructions issued by SAMA.