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Bank deposits drop in Saudi Arabia, higher rates hurt margins

According to data released by the Saudi Arabian Monetary Agency (SAMA), bank deposits in the kingdom fell the most in nine months in May, as lenders facing higher interest rates cut back fixed deposits to reduce costs and boost profit, Bloomberg has reported. Total deposits at the 23 lenders operating in the largest Arab economy fell for a second month, dropping 0.5% in May, the most since last August, to SR1.14trn ($304bn). Demand deposits comprise 60% of the total, while savings deposits make up 26%, the data showed.