Bank Profits in GCC Region Soar by 10.5% in Q1 2024
In a stunning revelation, the net profit of banks in the Gulf Cooperation Council region skyrocketed by 10.5 percent year-on-year in the first quarter of 2024, reaching an impressive $14.4 billion, as per an analysis conducted by Kamco Invest.
Robust Growth Despite Challenges
Despite facing challenges, the bottom line performance of these banks saw a significant rise of 11.8 percent in the first quarter compared to the previous three months. The study highlighted that despite higher borrowing costs, the region witnessed a continuous increase in lending.
Regional Breakdown
The analysis revealed that banks in Saudi Arabia experienced the most robust growth in the first quarter of 2023 at 3.3 percent, while UAE banks saw an increase of 1.1 percent in gross credit data during the first two months of the year.
Record Highs and Strong Deposits
Listed banks reached a milestone with gross loans hitting $2.02 trillion at the end of the first quarter of 2024, showing a 1.8 percent growth quarter-on-quarter. Customer deposits also surged, reaching $2.45 trillion with a 2.8 percent quarter-on-quarter growth.
Revenue and Income Trends
However, total revenue of listed banks in the GCC region dropped for the first time in 12 quarters to $31.4 billion due to elevated interest rates. Despite a flattish gain in total interest income, interest expenses surpassed the growth in income. Non-interest income also took a hit, declining for the first time in six quarters.
Outlook and Conclusion
Despite facing challenges, the banking sector in the GCC region showed resilience and growth in the first quarter of 2024. With a focus on managing costs and boosting income, banks are navigating through a changing landscape to ensure continued success in the future.