Saudi Arabian bank lending is climbing the most among the six Gulf Cooperation Council nations this year as growth in the biggest Arab economy accelerates. Bank credit to the private sector expanded 4.6 percent in the five months through May. The rate ranged from a 4 percent drop in Bahrain to a 2.7 percent increase in the other five GCC countries. Higher oil production to compensate for a drop in output from Libya and increased government spending to counter the political unrest in the region are boosting the economy of the world's largest exporter of crude, according to John Sfakianakis, the Riyadh-based chief economist at Banque Saudi Fransi (BSFR), a lender part-owned by Credit Agricole SA. "There is a recovery under way, the retailers, the family businesses, they are all benefiting, which is spurring lending from the banks," Sfakaniakis said. Saudi Arabia's economy "didn't have the excesses that some of the other countries in the region had, like the real-estate bubble in Dubai, Abu Dhabi and even Qatar" to which the banks were exposed, he said. The $130 billion spending plan announced by King Abdullah, Custodian of the Two Holy Mosques, in February and March will help boost economic growth this year to 5.3 percent from 3.8 percent in 2010, the National Commercial Bank said earlier.
