Public spending helps Qatari banks
Public spending has helped Qatari banks’ loan book growth to the highest in the GCC. Banks in Qatar registered the highest growth of 23.1 percent year-on-year in the second quarter of 2013, way ahead of regional banks, said Global Investment House.
The overall loan book growth in the region during the period is 13.9 percent. Qatari banks, up 30.6 percent year-on-year, 2013 led the region’s non-interest income growth during Q2. The profitability of banks in Qatar increased by 13.4 percent during the period.
The loan book of GCC banks grew 13.9 percent year-on-year to USD631.2 billion in Q2 of 2013. Qatar witnessed the highest increase followed by Saudi Arabia, 13.0 percent. Commenting on this trend, Mohamed A Abdulkhalek, al khaliji’s group chief business officer said that Qatari banks have been building up their capital base and intellectual capital to support projects which will call for huge investments and are in various stages of planning and implementation. “Public sector spending will continue to drive credit growth,” he added.
Banks, Abdulkhalek said, will provide long-term financing to the developers of the projects and will also provide tailor-made financing packages to various parties involved at the implementation level including contractors and suppliers. The level of capitalisation maintained by Qatari banks should enable them to play a major role in the development of these projects. “Also, most Qatari banks have tapped debt capital markets during the last few years which enabled them to secure long-term funds at competitive borrowing rates, benefiting from high demand for Qatari issuers,” he said. al khaliji’s loan book grew by 14 percent during H1 2013 and 30 percent comparing with H1 2012 to reach QAR14.9 Billion.