National Commercial Bank (NCB) of Saudi Arabia has reported growth in its letter of credit (L/C) business, despite more moderate Saudi imports in February following a surge that peaked in July last year.

According a report recently published by the bank, more L/Cs were settled in March compared with the previous two months.

Settled L/Cs

On an annual basis, settled L/Cs grew by 8.1 per cent in the year to March 2013, supported by a surge in imports of foodstuff and motor vehicles by 61.6 per cent and 45.8 per cent respectively.

Settle L/Cs for machinery and building materials imports, however, fell steeply, showing 23.8 per cent and 10.2 per cent declines respectively.

Opened L/Cs

According to the NCB report, opened L/Cs grew by 15.2 per cent in the year to March 2013.

This growth was substantially driven by burgeoning demand for motor vehicles, for which the value of L/Cs opened increased by a massive 105.1 per cent over the previous year.

Mixed demand

The value of L/Cs opened for imports of foodstuff grew by 38.8 per cent on a year-on-year basis to March 2013.

These increases were partially offset by L/Cs opened for machinery and building materials imports, the value of which on an annual basis fell by 12.7 per cent, and 28.9 per cent respectively.

This article represents the views of the author and not necessarily those of the ICC or any of the other partners in DC-PRO.