Abu Dhabi: A new list is out by Forbes Middle East ranking the 75 largest banks in the Arab stock markets, based on their performance during the year ending December 31, 2011.
The listing which includes 75 Arab banks was dominated by banks from the GCC region which made up 57 of the total list. Coming on top was QNB with total assets of $82,995 million, followed by Al Rajhi Bank of Saudi Arabia with total assets of $58,940 million.
The study included 19 countries within the Middle East and North African region, with the exception of Syria, Libya, Iraq, Mauritania, Yemen, Algeria, Sudan and Tunisia due to the political instabilities and the fact that financial data was not yet available at the time this study conducted.
Khuloud Al Omian, Editor-in-Chief at Forbes Middle East, told Gulf News that the ranking was based on annual stock market reports followed with an in-depth three-month research. The main parameters for the listing are revenue, profits, deposits, loans, total assets and NPLs.
“It is a true reflection of the economies which those banks work in,” said Mohammed Ali Yasin, an independent financial analyst speaking of the Forbes Middle East ranking.
“There’s no doubt that the strongest banks are the GCC banks,” he said.
For instance, Emirates NBD which is the second largest by assets landed rank number7. It is also the highest lending bank with total loans of $55.3 billion.
“You can’t just look at a bank’s assets, without looking its cash flows, NPLS, etc.,” Yasin said.
“I think today banks are the most important sector, at least in the GCC and Arab world, because it is the major source of liquidity for the private sector and a major supplier to government related entities,” he added.
Speaking of the performance of the UAE banks, Yasin said that the government intervention when the crisis happened has helped the banks rebuild their balance sheets. “Those banks have the opportunity in the future to go up those lists while those on top will really struggle to stay on the top,” he said. “And this takes time — five years from the crisis.”
Of the 75 banks, Kuwait has a total of eight banks making 11 per cent of the total, Jordan and Qatar each have seven banks constituting 9.5 per cent each, and Oman presents six banks with 8 percent.
Morocco and Lebanon each make up 5 per cent of the total, both entering the list with four banks, followed by Egypt with two banks, constituting 2.5 per cent. Finally, Palestine got a share of the pie with one bank only at number 75.
Al Omian said that the magazine has received calls about the basis on which the ranking has been made. “We would definitely do it again,” she said. “I think it helps. In many ways, we’ve done their [the banks] homework.”
At the end of the day it is a very sensitive driven industry, Yasin explained. “Today, people are looking for the safe haven that is the name of the game across the world.”
