Moody's: Stability of the banking sector in the Gulf
Economy News _ Baghdad
Moody's has announced a positive outlook for the Gulf banking sector, citing its stable view of the strength of banks' financial fundamentals, enhancing their ability to meet challenges and profit.
Although geopolitical risks present a challenge to the banking sector, the strength of the GCC economy balances those risks.
Moody's forecast that the actual GDP of the Gulf states would grow from zero in 2017 to 2 percent in 2018 due to oil prices of between $ 50 and $ 60 a barrel.
In particular, the report pointed out that the fundamentals of the banking system, savings and lending rates remain strong, boosting expectations for a stable credit situation.
Moody's said major projects in the region, such as Expo 2020 and Saudi Arabia's national transformation program, were supporting growth in bank spending and credit, which is expected to grow by 5 percent in 2018.
While the report mentions good prospects for the banking sector in the UAE and Saudi Arabia, where 75 per cent of bank assets indicate some weakness in the financial situation in Bahrain and Oman and continued pressure on the banking sector in Qatar especially its ability to lend in the shadow of Qatar's crisis with its Gulf neighbors.