Middle East banks' revenues up 6.9 pc
Dubai, March 29, 2013
Middle East banking revenues continued to grow at single digit rates in 2012, posting a 6.9 per cent increase, a study said.
Profits increased by 8.1 per cent due to an overproportional increase in extraordinary income, shows a recent study by the Boston Consulting Group (BCG).
Based on 2012 annual results as reported by the banks in the first quarter of 2013, the new study is part of BCG's annual banking performance indices measuring the development of banking revenues (operating income) and profits for leading Middle East banks, reported the Gulf Daily News, our sister publication.
BCG launched the first edition of the banking performance index in the Middle East in April 2009, creating a customised index, specifically for the regional banking markets, with 2005 revenues and profits as starting benchmarks.
The index covers the largest banks in Bahrain, Kuwait, Qatar, Oman, Saudi Arabia and the UAE, the report stated.
While banks in Qatar grew revenues by 12 per cent and banks in Saudi Arabia and Oman achieved high single digit growth rates, banks in the UAE, Kuwait and Bahrain achieved a revenue growth rate of 5 per cent or below.
Banks in all countries achieved above 7 per cent profit growth rates, except in Kuwait with 3 per cent.
"The 2012 BCG index includes 32 banks from across the GCC capturing nearly 80 per cent of the total regional banking sector," said BCG's Dubai office senior partner and managing director Dr Reinhold Leichtfuss, who is also leader of BCG's Financial Institutions practice in the Middle East.
"While the performance of Middle East banks settled at high single digit growth figures in 2012, it still compared very well with the international banks which experienced a further revenue decline.
"This provides the Middle East banks the opportunity to undertake the necessary investments in capabilities and regional expansion," he added.
In an environment of slower market growth, smart strategies and better capabilities are essential to grow more than the competition.
Leading Middle East banks are striving for regional expansion to find new areas for growth.
Many Middle East banks are prioritising better customer service as a critical part of their agenda.-TradeArabia News Service