Islamic banks in GCC to stay resilient in 2019-20

DUBAI / Emirates Business

Islamic Banks in the Gulf Cooperation Council (GCC) are expected to show resilience over the next two years after weathering tough market conditions in 2018, said S&P Global Ratings in a report published on Monday.
“In 2018, GCC Islamic banks expanded slower than conventional peers for the first time in five years,” said S&P Global Ratings Global Head of Islamic Finance, Mohamed Damak. However, the growth difference was a mere 1%, which explains why we think the conventional and Islamic banks in our sample will see similar growth patterns in 2019-2020.
“GCC Islamic banks’ saw customer deposits growth halve to 2.5% in 2018, compared with 6.4% in 2017. However, thanks to relatively muted loan growth, the funding profile of these banks remained stable and comparable with conventional peers.”