According to Fitch Ratings, Gulf banks' profits remain strong in all Countries, as most of them benefit from cheap financing.
According to Fitch, cost efficiency in Qatar is far superior to that of its peers, as banks focus more on large projects, often related to Government, and on smaller sub-networks. Fitch reported weakness in the sovereign capacity to provide support to banks in some Gulf countries, which led to an average reduction by one degree in the rating of defaults in Oman and Bahrain.
In its report, the agency showed that 90 percent of its issuer default ratings for Gulf banks are investment grade, showing that 76 percent of these ratings benefit from potential sovereign support directly or through the support of the parent bank. While 21 percent of ratings are backed up by independent credit ratings of banks, up 19 percent from last year.
Source (Al-Rai newspaper-Kuwait, Edited)
