UAE banks emerged as the strongest financial institutions in Gulf oil producers in terms of capital adequacy but they have the highest ratio of non-performing loans (NPLs) to total credit, according to a Western report.
Following an extensive drive to build up their finances in the wake of the 2008 global fiscal turmoil, banks in the six-nation Gulf Cooperation Council (GCC) now enjoy a strong capital base, with the adequacy ratio exceeding 15 per cent in all member states, said the study by the Washington-based Institute for International Finance (IIF).
“GCC banks remain well capitalized and profitable. The balance sheets of banks in the region have been strengthened as a result of the strong economic performance in recent years and high government participation in banks,” said IIF, which groups scores of major Western banks.
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