Banque Saudi Fransi fined for payment breaches
The Saudi Arabian Monetary Authority (Sama) fined Banque Saudi Fransi, which is listed in Riyadh, after the regulator found the lender guilty of payment breaches in its employee incentive scheme.
Saudi Fransi’s incentive programme has been closed and the lender will have to recover funds from individuals through court proceedings, according to the regulator.
The central bank said it met previously with the board of the bank, after which decisions were taken that included the appointment by the lender of an independent investigative body, which drafted a report on perpetrated breaches. After examining the findings, Sama imposed the penalties on the lender.
In a regulatory filing to the Saudi Stock Market (Tadawul), where Saudi Fransi shares are traded, the lender said all amounts paid under the employee incentive programme in past years have been calculated in the financial statements previously announced by the bank.
“The board does not expect any significant changes in the bank’s financial statements,” it said in a statement to the bourse without specifying the amount lost. The lender is coordinating with authorities to recover the amounts and will “hold the accountants and beneficiaries accountable” and if any amount is recovered, it will be included as additional profits for previous periods.
The bank has put in place “the necessary corrective measures to avoid such abuses in the future”, Saudi Fransi said.
The lender counts billionaire Prince Alwaleed bin Talal, who has been detained along with other high-profile personalities following a crackdown on corruption by Saudi Arabia, as its single largest shareholder.
Kingdom Holding, his investment vehicle, struck a deal in September to buy a 16.2 per cent stake in the lender from
The incentive programme has been closed and the bank must recover funds from individuals through court proceedings
France’s Credit Agricole Corporate and Investment Bank for about 5.76 billion Saudi riyals (Dh5.64bn).
The change in ownership of Banque Saudi Fransi will leave Credit Agricole Corporate and Investment Bank with a 14.9 per cent stake.
While Credit Agricole Corporate Investment may sell a further 5 per cent stake in Banque Saudi Fransi, it will remain a strategic investor in the bank and is committed to keeping a 9.9 per cent stake in the lender for at least a year after the deal goes through.