Expansion To Saudi Arabia, Indonesian Islamic Bank Cooperates With Riyadh Bank

Photo: Doc. Antara/BSI

JAKARTA - PT Bank Syariah Indonesia Tbk (BSI) is collaborating with Riyad Bank to develop global business, especially in Saudi Arabia, and strengthen the national economic recovery.

Director of Treasury & International Banking BSI Moh Adib said that through this strategic understanding, Riyad Bank will later become BSI's partner in expanding its business in Saudi Arabia, such as treasury, hajj and umrah, trade finance, remittance, and other interbank businesses.

"This step is part of our efforts to realize the vision to make BSI the Top Ten Global Islamic Bank. In addition, this synergy is also expected to make it easier for Indonesian people to perform Hajj and Umrah," said Moh Adib in a statement as quoted by Antara, Wednesday 2 October.

The signing of the memorandum of understanding for the synergy was carried out by SVP International and Financial Institution BSI Anna Kristanty and SVP Financial Institution Riyad Bank Yazeed Al-Alami, in Jeddah, Saudi Arabia, Tuesday 1 October.

This collaboration is also expected to help MSME players and Indonesian companies in expanding markets in the Middle East, especially in Saudi Arabia.

In this collaboration, continued Moh Adib, BSI, and Riyad Bank will also collaborate for the development of human resources, especially in increasing Islamic banking literacy.

Indonesia and Saudi Arabia have well-established bilateral relations in the economic field. The trade value between Indonesia and Saudi Arabia was recorded at US$5.5 billion in 2021 with Indonesian exports to Saudi Arabia during the January-December 2021 period reaching US$1.5 billion, an increase of 12.78 percent compared to the same period in 2020 which was recorded at 1 .33 billion US dollars.

In addition, the total value of Foreign Direct Investment from Saudi Arabia to Indonesia reached 24.6 million US dollars in the 2016-2021 period.

Saudi Arabia's economic growth in the second quarter of 2022 penetrated 11.8 percent, one of which was driven by an increase in oil and gas-related activities by 23.1 percent and non-oil and gas economic activities which grew by 5.4 percent.

"We believe this strategic cooperation can further strengthen economic relations between Indonesia and Saudi Arabia, which in the future can become one of the pillars of Indonesia's healthy and sustainable economic growth," said Adib.

At the global level, BSI has started its business expansion by opening a BSI Representative Office in Dubai, United Arab Emirates in mid-May. The presence of BSI in Dubai is at the same time a new chapter in the history of the national financial sector in market expansion in the Middle East.

In addition, the presence of BSI in Dubai is also expected to provide an illustration that Indonesia, which is currently holding the G20 Presidency, continues to show good financial and banking performance.