Middle Eastern banks have maintained their impressive growth momentum in 2014’s Top 1000 ranking. Total profits for the region’s lenders hit $38.3bn, up from $34.5bn in 2013. These figures are largely boosted by the performance of Gulf-based institutions, which once again feature prominently across most of the key indicators. Only five banks in the top 25 regional list hail from outside of the Gulf.
Philip Alexander reports on the full results of The Banker’s Top 1000 World Banks ranking 2014, in the story Top 1000 World Banks 2014: Back on track?
Institutions from Saudi Arabia and the United Arab Emirates continue their dominance in this year’s rankings. National Commercial Bank again takes the top spot in the regional top 25 by a clear margin, with Tier 1 capital of $11.1bn, while Saudi Arabia-based Riyad Bank replaces Qatar National Bank (QNB) in second place. QNB’s fall in the rankings, to seventh place, is attributable to regulatory adjustments to the Qatari lender’s capital. By other metrics, including profits and total assets, it is the regional leader, while shareholder equity has also increased significantly over the past year.
Meanwhile, Emirates NBD returns to the top five for the first time since 2012, with $8.55bn in Tier 1 capital, replacing Saudi Arabia’s Al Rajhi Bank in fourth place.
The strength of the Gulf-based institutions in this year’s rankings is partly down to an increase in their regional and international expansion. This has delivered significant balance sheet growth, as the banks capitalise on larger, faster growing markets outside of their respective domestic spheres. Notable expansions include Emirates NBD’s completed acquisition of BNP Paribas’ Egyptian unit for $500m in June 2013.
In a significant change from last year’s rankings, Iranian banks feature heavily in the highest movers category. Posting a 198.42% increase in Tier 1 capital, Iran’s Bank Maskan is this year’s highest mover. Its growth is, in part, due to the bank’s role in implementing a government-backed affordable housing scheme. Iran-based Sina Bank and Bank Tejarat also show impressive growth, registering 42.08% and 35.56% changes in Tier 1 capital, respectively. All three are new entrants in the highest movers table. Lebanon’s Credit Libanais is the only other non-Gulf lender in the highest movers list.
Two institutions from Bahrain feature in the highest movers list for the first time, with Gulf Finance House and Al Salam Bank making appearances in third and 10th, respectively.
In terms of return on capital, Iranian lenders once again feature prominently. Yet, the relatively low capital levels of these institutions goes some way to explaining their preponderance. The only non-Iranian lender in this category is Qatar National Bank, which ranks fourth.
