Saudi Arabia’s National Commercial Bank (NCB), the Kingdom’s largest lender in terms of assets, has ended merger talks with Riyad Bank.

"The boards of directors of the National Commercial Bank and Riyad Bank have agreed to end preliminary discussions and to discontinue the merger study of the two banks,” NCB said in a statement to the Saudi Stock Exchange (Tadawul) on Monday.

Riyad Bank, NCB’s smaller Tadawul-listed competitor, had started preliminary talks with NCB in December of last year.

The agreement was expected to create a combined lender with a value of 685 billion riyals ($183 billion) and would have rivaled the Kingdom’s current second largest lender, Al Rajhi Bank.

Saudi Arabia’s sovereign wealth fund, the Public Investment Fund (PIF) owns a 44.29 percent stake in NCB and 21.75 percent in Riyad Bank.

In June, Tadawul-listed lendersAlawwal Bankand Saudi British Bank (SABB) finalized a merger deal, establishing the Kingdom’s third largest lender.

The bank merger came two years after First Gulf Bank and National Bank of Abu Dhabi – two of the biggest lenders in the United Arab Emirates –tied up to create First Abu Dhabi Bank.