Gulf banks weather bourse turmoil but profit growth stifled

0 Comments | AFP, January, 2007

ABU DHABI (AFP) — Commercial banks in the oil-rich Gulf region have managed to weather the storm in most local stock markets in the past few months but their profits have been stifled. In the United Arab Emirates, which has the second largest banking sector in the Arab world after Saudi Arabia, growth in the net profits of banks in 2006 is projected to be as low as 10 percent of the 2005 growth of nearly 100 percent.

"UAE banks were undoubtedly affected by the stock market chaos last year but it was still a good year as they are expected to record 10-15 percent growth in their net earnings," said economist Mohammed Asumi on Wednesday. "Banks in the UAE and other Gulf states have managed to weather that (stock market) storm (because) many of them have diversified their...