Qatar’s banking sector has not only overcome the challenges posed by the unjust siege imposed by blockading countries, but it also continues to grow stronger. The strength of the country’s banking sector was, once again, vindicated in a recent report.
Consulting firm PwC, in a recent report, noted that Qatar’s banking sector had showed solid performance in the first half of 2019. PwC, which looked at key trends affecting the banking sector and the performance of the eight listed Qatari banks in its first Qatar Banking Sector Report, noted the sector performed strongly, with healthy aggregated profitability while asset composition remained mostly unchanged.
According to PwC, over the past three years, Qatar’s banking industry has grown at a remarkable pace. The total loans and advances of the eight listed commercial banks, which include financing assets, grew by 19.8 percent in the first half of 2019 compared to first half of 2016.
Customer deposits, which include equity of (unrestricted) investment account holders and customers’ current accounts of the Islamic Shariah compliant banks, grew by 22.5 percent between first half of 2016 and first half of 2019. The aggregated profits of the listed commercial banks also increased by 17.5 percent in first half of 2019 compared to first half of 2016 driven by the increase of the aggregated net income.
Qatar Central Bank (QCB) data has showed that banking sector in Qatar has fully recouped from the initial glitches caused by the economic blockade by the neighbouring countries.
QCB’s 10th Fiscal Stability Report, released in July this year, said demonstration of resilience to the economic blockade by the banking sector facilitated it to regain the confidence of the international investors.
The banking sector assets averaged around QR1.38 trillion in 2018, recording a substantial growth of around 5.6 percent.
In 2018, banking sector considerably reduced their geographical risk by well diversifying the regions from which they sourced the deposits. The maturity structure of the funded liability also improved, whereas banks could mobilise more long-term maturity funds in 2018 thereby reducing the volatility risk to a greater extent.
The year 2018 also witnessed major credit rating agencies upgrading the banking sector outlook from negative to stable. Non-Resident deposits, which experienced withdrawal pressure in 2017, rebounded in 2018. The resilience shown by Qatar’s banking has demonstrated that country’s banks are ready for expansion and growth.
