Arab banks from Oman to Morocco continue to produce record profits year after year and, despite the stock market correction in the Gulf earlier in the year and the recent dip in oil prices, 2006 looks set to be yet another bumper year. Commenting on the biggest banking market, a recent Standard & Poor’s (S&P) report said Saudi Arabian banks had registered record financial performance over the past three years, amid spectacular economic growth.
“For full year 2006, we expect loan growth to remain high, the funding mix to evolve toward longer term funds raised in the international markets, and brokerage fees to remain relatively stable at high levels, despite the severe correction of Saudi stock prices,” S&P said in the report. It believes that these effects should translate into higher profits for Saudi banks in 2006, although the rate of increase is likely to be in single digits.
