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Sunday, 17 July 2016

UAE banking sector growth expected to remain soft in 2016 | GulfNews.com

UAE banking sector growth expected to remain soft in 2016 | GulfNews.com:

"The UAE’s banking sector earnings are expected to soften further in the second quarter as many banks are likely to announce weak growth in lending and profitability in their second quarter earnings, according to banking sector analysts.

“We forecast bottom line to fall -3.5 per cent year on year in the second quarter as growth remains soft amid a challenging macro environment, net interest margins (NIM) is under moderate pressure, non- net interest income (NII) should slip, JAW ratio [ ratio of income growth rate to expense growth rate] are slightly negative despite operating expenses (OpEx) optimisation,” Jaap Meijer, head of Research at Arqaam Capital said in a note.

UAE banks are well capitalised and have comfortable liquidity position despite the difficult macroeconomic situation prevailing due to low oil prices. In 2015, profitability of UAE banks moderated and the trend is expected to continue in the short term."



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