S.Arabia -family source@
* Freed after pledging financial settlement to Riyadh -source
* No comment from Masri family
* Masri was detained amid Saudi crackdown on corruption (Masri holds meetings inside bank, market reacts positively)
AMMAN, Dec 19 (Reuters) - Palestinian billionaire Sabih al-Masri, Jordan's most powerful businessman, returned to Amman on Tuesday after his release in Saudi Arabia secured when he agreed to pay an unspecified amount of money, sources close to the matter said.
Masri was detained for questioning last week over his alleged links with Saudi business partners among royals, ministers and officials who were rounded up last month in an unprecedented anti-corruption purge.
Masri, chairman of Amman-based Arab Bank, Jordan's largest lender, was taken into custody just before he was planning to leave Saudi Arabia after chairing meetings of Saudi companies he owns, informed sources said.
"He is at his home now in Amman," said a family source.
Masri later held meetings in the bank with senior officials.
Arab Bank shares, which account for almost a quarter of the $24 billion market capitalization of the Amman exchange, ended 1.48 percent higher as investors reacted favourably to the news of his return.
Masri has since taking the helm at Arab Bank in 2012 helped boost confidence in one of the Arab world's largest private financial institutions.
The bank, first established in Jerusalem in 1930 and one of the major Middle East financial institutions, has a balance sheet of more than $45 billion and has earned a reputation of resilience in the face of regional political turmoil.
Masri, a Saudi citizen, said from his home in Riyadh on Sunday after his release that the Saudi authorities had accorded him "all respect". Saudi officials have not commented on his detention. Jordanian authorities privately said King Abdullah intervened to secure his release.
A source familiar with the matter said Masri was freed after reaching a settlement to return an unspecified amount of money. There was no comment from the Masri family.
"There is no way Masri has been freed without agreeing to some settlement. The Saudis are telling anyone who has made huge sums of money that they have to pay back some of that wealth," the source said.
Another source said Riyadh saw these settlements not as blackmail but an obligation to reimburse money taken illegally from the world's top oil producer over several decades.
Saudi authorities have already succeeded in reaching financial settlements with dozens of royal family members, senior officials and wealthy businessmen in the crackdown spearheaded by powerful Crown Prince Mohammad bin Salman.
Around 200 people in total have been questioned in the crackdown, authorities said last month.
Saudi authorities estimate they could eventually recover around $100 billion of illicitly held funds.
They have been working on reaching agreements with suspects detained at Riyadhs luxurious Ritz Carlton hotel, asking them to hand over assets and cash in return for their freedom.
Masri's detention unnerved business circles in Jordan and the Palestinian Territories as well as many Arab magnates across the Middle East who have made fortunes in Saudi Arabia, according to several investors who asked not to be named.
His multi-billion-dollar investments in hotels and banking in Jordan represent a cornerstone of the economy of the kingdom and he is by far the biggest investor in Palestinian areas.
A member of a prominent merchant family from Nablus in the Israeli-occupied West Bank, Masri amassed a fortune by joining with influential Saudi royals in a catering business to supply troops during the U.S.-led military operation to retake Kuwait from Iraq in the 1991 Gulf War.
Confidants said Masri had been warned not to travel to the Saudi capital after mass arrests of Saudi royals, ministers and businessmen in early November.
Officials and businessmen had warned of the reverberations of the crisis on an aid-strapped Jordanian economy already plagued by high debts. Saudi Arabia is a major donor. (Editing by Mark Heinrich, William Maclean)