JEDDAH — The GCC banking revenues grew by 7.2 percent, down three percentage points from the previous year, as low oil prices began to dent the real economy, Boston Consulting Group (BCG) said in a study.
In 2015, the majority of GCC banks were able to achieve revenue growth.
About 11-17 banks achieved double-digit growth, while 11-15 banks witnessed negative growth overall or in customer segments, the BCG said.
Oman banks led the pack in terms of growth numbers with 9.6 percent in revenues and 10.5 percent in profits. In parallel, UAE banks’ revenues grew by 8.1 percent and Kuwait banks recorded a 11.4 percent profit growth. The 2015 BCG index includes 45 banks from across the GCC, capturing about 80 percent of the total regional banking sector.
“2016 would be slightly more challenging. Low oil prices would put pressure on government spending, salary growth. So I would expect profit growth would be lower and there would continued pressure on profits as well,” Reinhold Leichtfuss, senior partner and managing director at BCG Middle East, said at a news conference, adding “increased cost of funding would put pressure on margins.” — SG/Agencies
