The value of the facilities used and offered by licensed persons "brokerage firms" in the Saudi stock market increased by 22 percent at the end of the fourth quarter of 2019 compared to the previous quarter, coinciding with the subscription and trading of shares of "Saudi Aramco", to record the highest quarterly increase.
The facilities used increased to about 7.56 billion riyals, compared to about 6.19 billion riyals at the end of the third quarter of 2019, and an increase equivalent to about 1.37 billion riyals.
According to the analysis of the reporting unit in the "Al-Iqtisadiya" newspaper, based on the data of the Capital Market Authority, the facilities used are equivalent to 67.7 percent of the sums available to clients amounting to the end of the period 11.17 billion riyals.
On an annual basis, the facilities used in trading local shares increased by 13%, due to the decrease in the use of the facilities during the second and third quarters of last year, by 6.9% and 1.6%, respectively.
According to the analysis, the facilities used by the end of 2019 grew for the second year in a row, while the highest level was recorded in about three years, reaching by the end of 2018 about 6.7 billion, by the end of 2017, they reached about 5.51 billion and about 6.84 billion riyals by the end of 2016, while the facilities used by the end of 2015 About 13.7 billion riyals.
This decline is due to the decision of the Saudi Capital Market Authority at the end of 2015, which prohibited companies licensed to provide financial facilities to traders in shares with more than 100 percent of the value of the financial portfolio after some brokerage companies provided financing up to 200 and 300 percent of the value of the clients ’financial portfolios.
The funds of the persons licensed in the Saudi Stock Exchange are divided into two categories, the first is direct funds and it is from the person licensed to the customer directly, while the second category is indirect funds which are provided by a third party through the licensed person.
Direct financing from authorized persons and used by customers for direct stock traders accounted for 88.1 percent of the total by the end of 2019, amounting to 6.66 billion riyals.
While the funds provided by the persons licensed to clients through a third party accounted for 11.9% of the total, with a value of 900 million riyals.
The number of clients who obtained facilities through the persons licensed in the market increased to the highest level in four years, as they reached 2,601 clients, registering an increase compared to the previous quarter by about 16.6%, while their number was 2234 customers by the end of the third quarter 2019.