Saudi Arabia's Supreme Economic Council has offered guarantees for bank deposits in the kingdom, the central bank governor, Hamad Saud Al-Sayyari, said on Monday.

The economic council, Saudi Arabia's highest economic body, said on Oct 16 the government would 'continue to ensure the health of Saudi banks and bank deposits'.

Al-Sayyari said there was no need for fear over the safety of bank deposits.

He said the sharp declines on Saudi Arabia's stock market were due to poor investor sentiment stemming from the global financial turmoil, not economic fundamentals

Saudi Arabia's main index has fallen more than 50 percent this year.

He said public spending in kingdom had risen 19 percent so far this year.

Economic growth prospects remained strong for this year and 2009, he told reporters, adding that banks were in an excellent condition despite global financial turmoil.

However, he said Saudi Arabia's crude oil and petrochemical exports will get affected by the global economic crisis. -Reuters