Saudi Arabia's Samba Financial Group said on Tuesday its board had proposed increasing the bank's capital by SR8 billion  ($2.13 billion) through issuing bonus shares to help support future growth.

The kingdom's fourth-largest lender by assets will increase its capital to SR20 billion from retained earnings by issuing two shares for every three shares held, the lender said in a bourse statement, subject to the approval of shareholders and regulators.

No money is being raised from shareholders, who are getting the new shares for free, but the move is an accounting device which in effect boosts the bank's equity and therefore supports future lending.

"The group aims to raise capital to keep up with the increasing growth in the national economy and the large and continuous expansion within infrastructure in Saudi Arabia," the statement said.

Profitability at banks in the kingdom has been supported in recent years by strong loan growth, although this has contributed to lenders needing to top up their capital reserves -- some through the issuance of capital-boosting sukuk and others by bonus share offerings.

Samba posted a 22.5 per cent rise in its fourth-quarter net profit earlier in January, beating analyst forecasts. Its total loans grew by 9.4 percent in 2014.

A cash dividend of SR0.7 per share for the second half of 2014, announced in December, is separate from the bonus shares issue recommendation, Samba said. - Reuters