Saudi Arabia tightens oversight on UAE transfers

Saudi Arabia has placed financial transfers to the United Arab Emirates under enhanced regulatory oversight typically reserved for high-risk jurisdictions, according to three people with direct knowledge. The unannounced measures, implemented earlier this year, require Saudi banks to apply additional checks on settlements with the UAE, leading to delayed or returned transfers for businesses. The Saudi central bank denies direct restrictions on specific countries, citing its anti-money laundering framework aligned with FATF standards. The move is seen as a subtle message amid escalating tensions between the two Gulf monarchies, including disagreements over Yemen, OPEC, and economic rivalry. The UAE is now among over half a dozen countries deemed high risk by Saudi Arabia, alongside Lebanon, South Sudan, and Iraq. Businesses report routing payments via third countries to circumvent the delays. Analysts consider a full economic rupture unlikely given deep trade ties, but the measures signal growing friction.