GCC Banking Assets Reach $1.47TR Last Year
The banking sector in GCC remains healthy, reporting an 11 percent increase in assets last year. Rising energy prices and higher production levels fueled substantial public spending and drove growth in the credit industry. Positive movement in real estate and construction also helped to drive credit, and push banking assets to $1.47 trillion, based on recent statements by QNB Group.
Credit facilities make up a majority share of the assets in the GCC banking industry, accounting for more than half (58 percent) of total assets last year. Credit facilities expanded by 14 percent last year, reaching $859 billion.
Local banks are responsible for the majority of the assets in the GCC, with the leading twenty local institutions accounting for 66 percent of overall assets in the banking sector last year. QNB remains at the top of the pile, with assets totaling $101 billion at the close of 2012.
Qatar exhibited the greatest amount of growth in this sector, and made up 15 percent of the region’s banking assets. Qatar’s public sector has driven credit growth in the nation, as credit facilities surged by 26 percent last year and banking assets rose by 18 percent.
The public sector, real estate and construction were the top three recipients of credit facilities in Qatar.
The UAE still boasts the largest banking sector in the GCC, responsible for 33% of overall sector assets or $489 billion at the close of November. Credit facilities rose last year (12%) and overall banking assets in the UAE went up by 8 percent.
After reporting a decline in 2010 and 2011, credit facilities to the UAE construction sector increased last year. Credit to other sectors, such as wholesale trade and the public sector, also rose.
Saudi Arabia’s banking assets came in at second slot, totaling $462 billion last year. Credit facilities increased in the kingdom, rising 17 percent and driven by loans made to the manufacturing and trade sectors.
Banking across the GCC has remained healthy and sound, reporting robust balance sheet growth. GCC banks have good quality assets and a low NPL (or non-performing loan) ratio.
Mastercard Index Reports Rising Consumer Confidence in the UAE
The latest Mastercard Index of Consumer Confidence indicates a rising rate of confidence in the UAE. Moving from a previous index score of 86.0, reported just six months ago, the UAE now scores 91.4 on the index.
Overall consumer confidence in the Emirates is stated as “extremely optimistic” with all index indicators coming out positive.
Scores rose in four of the factors, with optimism regarding quality of life moving from 88.6 to 95.6, employment rising from 88.9 to 95.2, the economy moving from 89.1 to 94.6 and optimism in terms of the stock market increasing from 77.0 to 86.9. Confidence levels regarding regular income declined slightly, moving from 86.2 to 84.7, although that score continues to indicate positive levels of confidence.
Male and female respondents appear equally confident regarding the near future (91.4 score) and older consumers report lower levels of confidence than those under 30 years of age (90.4 compared to 94.6).
These findings of increasing consumer confidence reflect a positive outlook in the UAE in terms of key economic sectors, national plans and vision, according to Mastercard’s UAE manager Eyad Al Kourdi.
Consumer confidence continues at high levels across the Middle East, with 81.1 scores on average and positive ratings on all index indicators. This aggregate score ranks the Middle East above Africa at 69.6 and the Asia/Pacific region at 59.7.
Qatar reports the highest levels of consumer confidence (96.5), with Kuwait following closely at 95.8 and Oman at 95.6. Saudi Arabia reports high levels at 95.2 and the UAE consumer confidence comes in at 91.4. Egypt scores 66.6 on the index, and Lebanon comes in at 26.8
More than 11,000 respondents ranging in age from 18 to 64 and residing in Africa, the Middle East and around the Asia/Pacific region took part in the index. This latest release is the fortieth survey in the series, running since 1993.
Luxury Property Prices Up in Dubai, Still Low in Comparison
Real estate prices have increased in Dubai, moving up more than 20 percent last year. But according to a recent report by Knight Frank, prime luxury real estate in Dubai remains significantly lower than other regions in the world, including Monaco, Hong Kong and Mumbai.
Dubai properties fell in the $520 to $580 psf (or per square foot) price range during Q4 2012. In comparison, property prices in Monaco came in at $5,350 to $5,920 psf during the same period.
Hong Kong properties came in at $4,570 to $5,050 psf , with London properties ranging between $3,890 and $4,300 psf. Geneva properties were next on the list at $2,720 to $3,010 psf, and Paris followed at $2,350 to $2,600 psf. Mumbai remained significantly higher than Dubai, at $990 to $1,100 psf for local property.
Dubai came in at number 19 on the list of 20 locations included in the Knight Frank survey, with Cape Town finishing in 20th place at $510 to $570 psf for property.
On the other hand, Dubai tied for second place in terms of price growth, following Jakarta (38 percent price growth) and in line with Bali at 20 percent growth in property prices.
Dubai experienced a serious downturn in the real estate industry during the 2008/2009 period. Now, driven by resurging demand and supported by lower price levels, the emirate has rebounded. Dubai is more established as a strategic regional hub, attracting wealth from many areas, including central Asia, India, North Africa and the Middle East.
The prime market in Dubai dropped by 60 percent from 2006 to 2011. Values rose 2.5 percent last year, supported by increased investment interest, according to the report.
Demand for luxury residential property continued to be stable last year. Prices rose around the world due to strong demand, and in some cases, governments took steps to curb demand and control price increases.Paul Holdsworth, Staff Writer, Gulf Jobs Market News