Business | Banking
Mideast banks 'will report subprime losses'
MEED quotes bankers as saying exposure would be reflected in fourth-quarter earnings.
- Reuters
- Published: 23:33 January 26, 2008
Dubai: Banks in the Middle East will announce losses from exposure to the US subprime mortgage crisis when they report fourth-quarter earnings, the Middle East Economic Digest (MEED) reported, citing bankers.
Gulf Arab officials, including central bankers, have repeatedly said the region's banks were largely shielded from the crisis triggered by defaults on subprime mortgages, or home loans for people with a poor credit history.
Of the 20 largest Gulf banks by market value, only Abu Dhabi Commercial Bank has reported any subprime losses, writing down $19 million in the third quarter. "I am sure there will be write-downs from Middle East banks," MEED quoted an unnamed senior Bahraini banker as saying in its latest edition.
"Even we do not really know what our exposure is. I know there are some regional banks who thought all their investments were safe but are now discovering the underlying asset is subprime," the banker said, according to the London-based weekly.
Banks in the UAE and Bahrain, the Middle East's biggest financial centres, will be worst affected, it said. "We saw some of these funds underwritten by major wholesale banks in the region, particularly in the UAE and Bahrain," a Qatar-based banker said.
Many of the region's largest lenders have missed analysts' fourth-quarter profit forecasts, although none have attributed that to the subprime crisis.
Share this article
Popular in Business
-
General
Precious jump
Gold prices at new high as India's central bank buys $6.7b worth of gold
Business Editor's choice
-
UAE companies in full force at WTM
Seventy-eight participants are from Dubai and 50 from Abu Dhabi
-
DIFC committed to high standards
Ensures an efficient process to serve the business community
-
Sweet life in the Middle East
A sweet look at the confectionary industry in the UAE and Middle East
