Most of the Gulf banks will make profits in 2020

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Source: Dubai – Arabic.net

Standard & Poor’s said in a report issued today, Monday, that it expects most of the Islamic and conventional Gulf banks to make profits this year, despite the Corona pandemic, which coincides with the drop in oil prices.

The report, which was seen by Al Arabiya.net, said that the profits of banks will be negatively affected by the current conditions, but most of the banks will achieve profits.

She added that the rate of financing will be limited, and banks will focus on maintaining indicators of the quality of their assets from a high level, in exchange for expanding the granting of new funds in light of the current crisis.

She noted that the growth in deposits was strong in 2019, but she believes that the risks are concentrated in that the deposits are focused on government companies and government-affiliated companies, which represent about 10 to 35% of the total deposits in Gulf banks, which may force these companies to withdraw Part of the deposits to provide for their needs. The second type of risk relates to the impact of the Corona virus on the size of employment in the country, and their withdrawal of deposits from banks, indicating that this matter will appear after controlling the epidemic.

Despite this, the agency confirms that Gulf banks enjoy high liquidity indicators.







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