As the Gulf returns to work after the annual Eid al-Adha holiday, ratings agencies, banks and regulators are struggling to assess the implications of the region’s biggest financial crisis in almost 30 years.
The priority has been to calm fears. Bankers and regulators have been quick to try to minimise the damage by insisting their institutions’ exposure to Dubai and to Dubai World and its subsidiaries is limited.
Rasheed al-Maraj, the governor of the central bank of Bahrain, said yesterday that all of the banks on the island had some exposure to Dubai World but the total was less than 1 per cent of assets. The restructuring of Dubai World, the conglomerate that sparked the crisis last month by asking for a delay in payments on its debt, was a “normal” event.
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