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Bahrain banking sector on road to recovery

London, December 19, 2013

Top international ratings agency Fitch said in a new report that the Bahraini banking sector has been performing well since 2011 despite unrest, and that it expects profit growth next year.

Economic growth has been boosted by a resumption of oil production and government spending, with Fitch estimating a pick-up in growth to 5.5 per cent this year, said a report in the Gulf Daily News (GDN), our sister publication.

It does not expect a material deterioration in asset quality in the near term; therefore, pre-impairment operating profit should continue to easily absorb impairment charges.

Bahraini banks maintain adequately liquid balance sheets, says the agency. The average loans/deposits ratio across Fitch-rated Bahraini banks reduced to 75 per cent at end-June, with most being net placers in the interbank market.

Fitch Core Capital ratios have improved in recent years, driven by retained earnings, a cut in risk weighted assets and in some cases no dividend payments. - TradeArabia News Service




Tags: Bahrain | banking | sector |

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