GCC banking provisions reached record highs of $20bln last year - Kamco Invest | ZAWYA MENA Edition
The COVID-19 pandemic had a deep impact on the GCC banking sector resulting in record provisions being booked for fiscal 2020.
Not only was economic activity hit by the pandemic-induced lockdowns and restrictions in movement among GCC countries, the lower oil prices for most of the year saw state revenues slashed for the oil producing members.
The 62 listed banks in the GCC reported loan loss provisions (LLP) of $20.3 billion during 2020 with increases seen in all the six countries of the bloc, said Kamco Invest in a report on Wednesday.
Banks in the UAE saw the biggest spike in LLP during the year with an increase of 3.4 billion, or 72 percent, to reach 8.2 billion. On the other hand, Saudi Arabian banks booked the lowest percentage increase in LLP at 37.6 percent, or 1.3 billion, to reach $4.6 billion during the year.
Banks in the region set aside $6.4 billion for doubtful credit during Q4-2020, the highest for a quarter ever recorded in the region.
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