Saudi Arabia seeks $6-8 billion bank loan to shore up state coffers

Saudi

Saudi Arabia is seeking a bank loan of between $6 billion and $8 billion,  in what would be the first significant foreign borrowing by the kingdom’s government for over a decade.

Riyadh has asked lenders to submit proposals to extend it a five-year US dollar loan of that size, with an option to increase it, the sources said, to help plug a record budget deficit caused by low oil prices.The kingdom’s budget deficit reached nearly $100 billion last year. The government is currently bridging the gap by drawing down its massive store of foreign assets and issuing domestic bonds. But the assets will only last a few more years at their current rate of decline, while the bond issues have started to strain liquidity in the banking system.

-more Times of India

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