Gulf banks report more loan defaults as oil slump plays out | Reuters

Gulf banks report more loan defaults as oil slump plays out | Reuters:

"More than two-thirds of Gulf banks reported an increase in unpaid loans in the first three months of the year and more defaults are likely as oil-dependent governments slash spending to adjust to lower crude prices.

After several years in which banks' profits jumped thanks to the region's petrodollar boom, the oil markets' two-year malaise is taking its toll. New global accounting standards from 2018 will make lending even harder.

"The days of double-digit profits and expansion plans are gone," said one United Arab Emirates-based banker. "Now, it's all about single-digit growth and controlling costs as bad loans are going to keep getting higher. It's the new normal.""



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