United Arab Emirates Commercial Banking Report Q4 2012 - New Market Report

New Financial Services market report from Business Monitor International: "United Arab Emirates Commercial Banking Report Q4 2012"

by Bill Thompson

(WireNews+Co) - Boston, MA - 22 October 2012

BMI View: We expect the ongoing recovery in the UAE banking sector to gradually gather steam in 2012, although stress that our forecasts continue to see the aggregate balance sheet of the industry expanding by only 8.0% this year.

The main risk centres on the increasingly uncertain policy environment facing the industry. Indeed, we expect profitability to be undermined if banks are forced to cap the interest rates they charge on credit cards, or if they are required to write off a share of their personal loan books as a result of the government's ongoing efforts at reducing the debt burden of UAE nationals. Following a relatively lacklustre 2011, we expect the UAE banking sector's recovery to gradually gather steam in 2012, although caution that underlying profitability may take a hit due to the introduction of a recent spate of new regulations by the central bank.

The aggregate balance sheet of the retail banking industry expanded by only 3.5% in 2011, marking the slowest pace of growth in our time series dating back to 2000. At the same time, provisioning for non-performing loans continued to trend higher (coming in at AED55.3bn (US$15.1bn) in December, compared to AED44.3bn in the same month a year prior) amidst the multi-year decline in the real estate sector and ongoing concerns surrounding potential debt restructuring agreements by several prominent government related entities (see our online service, 10 April, 'Debt: GREs Out Of The Woods?').

Going forward, we are projecting the sector's balance sheet to expand by 8.0% in 2012, with loan growth projected to remain relatively muted at 5.0%.

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Partial Table of Contents:

Summary

- Table: Levels (AEDbn) - Table: Levels (US$bn) - Table: Levels At May 2012 - Table: Annual Growth Rate Projections 2012-2016 (%) - Table: Ranking Out Of 59 Countries Reviewed In 2011 - Table: Projected Levels (AEDbn), 2008-2016- Table: Projected Levels (US$bn), 2008-2016

SWOT Analysis

- United Arab Emirates Commercial Banking SWOT - United Arab Emirates Political SWOT - United Arab Emirates Economic SWOT- United Arab Emirates Business Environment SWOT

Business Environment Outlook

- Commercial Banking Business Environment Rating - Table: Commercial Banking Business Environment Ratings - Commercial Banking Business Environment Rating Methodology- Table: Middle East and Africa Commercial Banking Business Environment Ratings

Global Commercial Banking Outlook

Regional Outlooks

- Banking Sectors: Picking The Outperformers

Regional Banking Sector Outlook

- MEA Banking Sector Forecast Overview - Q4 2012 - Table: Banks' Bond Portfolios 2011 - Table: Middle East and Africa Commercial Banking Business Environment Ratings - Table: Comparison of Loan/Deposit & Loan/Asset & Loan/GDP ratios, 2011 - Table: Anticipated Developments in 2012 - Table: Comparison of Total Assets & Client Loans & Client Deposits (US$bn) - Table: Comparison of US$ Per Capita Deposits (2011)- Table: Interbank Rates and Bond Yields

MEA Banking Sector Outlook

- Islamic Finance: Another Banner Year Ahead

United Arab Emirates Banking Sector Outlook

- Banking Sector: Still Underperforming

Economic Outlook

- Battling Through Global Headwinds- Is The Optimism Misplaced?

Competitive Landscape

- Market Structure - Protagonists - Table: Protagonists In The UAE's Commercial Banking Sector 

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