Job Discussion Forums

ultraman111 · Joined: 17 Sep 2011 Posts: 148

Hi again,

Just a question about a propossed salary offer......which is in GB Pounds.

I shall explain. I wish to leave out names of individuals or corporations.

The monthly salary is in GBP and converted into Riyal which will be deposited into a local Saudi Bank. The pound has lost a lot of its strength in recent years and is sometimes known as the Brittish Peso. It currently sits at 1GBP = 5.94 Riyal. The rate of exchange is protected by a margin of 10% in the month you begin.

How safe are Saudi banks? I have no idea about that. Do they have any online accounts? Again, how safe are they..? How modern are the banks? Do they pay interest on your savings? Are there any fees? etc etc

My intention would be to save cash and build up a handsome sum to send to my home bank at an appropriate exchange rate. I figure at some stage or another the worlds economy will deteriorate and when some bad news event occurs and exchange rates are wildly affected ....and bingo, a nice exchange rate presents itself and everyone wishes they had a billion riyal to send home. Thats the time to really be doing it.

So, if someone has some good advice Id like to hear it. I dont want to spend the next 15 years in SA, just maybe the next 3 or 4.

sharter · Joined: 25 Jun 2008 Posts: 878 Location: All over the place

You can only open a bank account and remit money if you have an 'iqamaa' residency and work visa.

1-There are money laundering rules in place in the EU and they vary from country to country. If you send 10k the bank will flag you. Just a thought.

2-Being paid in GBP is good I think. Sterling has tanked against the Euro and we all know why now. Looking at the mess in Europe and the coming German and French elections, the Euro is set to weaken. Greece, Spain and Portugal are in big trouble. Against the Dollar it has just gone back to the level it was for a very long time before the 2007 Sterling/Dollar spike. The UK economy is not so great but we can print bonds to pay our debt, which at least gives us a way out. A GBP salary is a good thing right now believe you me. Huge tax breaks in the U.S. are coming to an end soon and the U.S. economy is still in trouble, which will have Dollar and therefore Riyal consequences.

3-I think you'd be better off buying the dip in the UK/European housing markets......that's what I'm going to do this year or early next year.

So chin up......and put up with those military cadets for as long as you can.

posh · Joined: 22 Oct 2010 Posts: 430

Banks are safe. Eg. SABB is part of HSBC. Must have an iqama.

Yes, you can do online banking and transfer to and from other accounts. Only fees I pay are tansfer fees - usually $30. Usury is haram!

A lot of other functions too - paying for visas, renew iqama, pay electricty bill, etc.

I just send mine back as and when, but never do HUGE amounts.

GBP has been 6SR or thereabouts for a few years now, so unless it devalues again you should get a consistent return. Must have been a bitter pill when it flew up past 7SR in 2007.

scot47 · Joined: 10 Jan 2003 Posts: 15343

In my lifetime the Pound Sterling has gone from US$4.80 to its current level of approx US$1.50

posh · Joined: 22 Oct 2010 Posts: 430

Was that during the crash of 1929? Rolling Eyes

johnslat · Posted: Mon Apr 09, 2012 12:28 pm Post subject:

Dear posh,

Actually, it was during that dust up in the Crimea, the Light Brigade and all that.

Regards,
John

scot47 · Joined: 10 Jan 2003 Posts: 15343

Sorry to disappoint you but it was when Clement Atlee was PM !

2buckets · Joined: 14 Dec 2010 Posts: 515 Location: Middle East

I wouldn't keep more than enough to get by month by month in a Saudi bank. I always transferred my salary out of the country the day I got paid. I used Al Raghi bank to make these transfers.

I was in Iran for the revolution, and watched the despair of people who had large sums in Iranian banks see their savings literally go up in smoke as the banks and their records were torched. They lost everything and had no recourse.

I'm not saying this scenario is imminent in KOSA, but you never know. Better to be safe than sorry.

The decline of the GBP was caused by government unleashing the printing presses which can only cause inflation and the devaluation of the currency.

scot47 · Joined: 10 Jan 2003 Posts: 15343

Decline of the GBP started in 1940. End of Empire !

ultraman111 · Joined: 17 Sep 2011 Posts: 148

Thanks for the insights.

Sending money month by month is OK I suppose, however I think saving a large amount for the day when the rates are at a much better level could make you an extra 5 - 10% overall, possibly more.

sending 100,000 riyal when the riyal is strong and the home countries money has been oversold is the way to go..When will this happen? well, who knows, but by going by past historical exchange rates....its sure to happen again.

sharter · Joined: 25 Jun 2008 Posts: 878 Location: All over the place

Well the way I see it is this; the Euro has been weakening against Sterling little by little for some months. Spain's lending is borrowing is nudging up and we know that Greece and Portugal are already up the creek. QE is coming to an end in Brtiain and the US. IF the Euro goes wrong, which I think it will, investors will head to the safe haven of the Dollar and/or Sterling. Given that the US tax breaks are coming to and end, I think Sterling's a good bet in the medium term.