Net earnings of GCC banks under Global Investment House’s coverage increased 4.7%YoY to USD5.3bn in 4Q15. Net profit of banks in the UAE increased the most (11.8%YoY), followed by KSA (3.7%YoY) and Kuwait (1.1%YoY); however, net profit of Qatar declined 2.1%YoY.
Loan book expands, margin declines
The collective loans disbursed by GCC banks under our coverage increased by 9.1%YoY to USD793bn in 4Q15, with Qatar leading (16.2%YoY), followed by UAE (8.1%YoY), KSA (6.5%YoY) and Kuwait (6.2%YoY). The net interest income of GCC banks increased 5.0%YoY in 4Q15; however, margins remained under pressure on YoY basis. The NII of banks in KSA grew the most (8.1%YoY), followed by Kuwait (3.9%YoY), Qatar (3.1%YoY) and UAE (2.8%YoY).
Non-interest income declines
Non-interest income of GCC banks fell 6.2%YoY during the quarter led by 1.1%YoY decline in fee income and lower investment gains. UAE (7.5%YoY) recorded a positive change in non-interest income, while Qatar (-22.5%YoY), Kuwait (-16.2%YoY) and KSA (-0.9%YoY) reported decline in non-interest income.
Asset base records stable growth
Total assets of GCC banks under coverage expanded 7.4%YoY to USD1.3tn in 4Q15. Qatar-based banks witnessed the strongest growth in total assets (11.9%YoY), followed by banks in UAE (9.8%YoY), KSA (3.4%YoY) and Kuwait (2.4%YoY).