MENA banking sector’s profits rise 30% thanks to economic diversification: EY 

MENA banking sector’s profits rise 30% thanks to economic diversification: EY 
MENA banking sector’s profits rise 30% thanks to economic diversification: EY 

Thank you for reading the news about MENA banking sector’s profits rise 30% thanks to economic diversification: EY  and now with the details

Jeddah - Yasmine El Tohamy - RIYADH: The banking sector in the Middle East and North Africa recorded a 30 percent annual increase in net profits in the first half of 2023, reported professional services group EY. 

According to its MENA H1 2023 Banking Report, the sector also recorded a year-on-year rise of 12.2 percent in net assets in the six months to the end of June 2023.

The company found that the sectoral growth was driven by a rising demand for loans, fueled by the region’s overall economic expansion amid its diversification efforts.  

“With limited effect to the ongoing banking industry crisis in the US and Europe, the GCC (Gulf Cooperation Council) banking sector has undergone a fundamental transformation and is now pursuing a strong upward trajectory, boosted by an increasing demand for lending,” said Charlie Alexander, EY MENA’s financial services leader, in a statement.  

“This development is playing an increasingly important role in the region’s overall economic growth amidst ongoing economic diversification drives,” he added. 

Furthermore, return on equity climbed by 6.18 percent year-on-year in the first half of 2023, while the net interest margin advanced by 0.2 percent. 

Operating income and total deposits exhibited substantial growth during the period, surging 18.8 percent and 6.08 percent rise, respectively. 

According to the report, 2023 will also witness a significant emphasis on regulatory oversight, including ongoing implementations of Basel IV regulations and an intensified focus on combating financial crime. 

The study added that nonperforming loans, a vital indicator of the bank’s credit risk, will persist at their existing levels as banks adopt a more conservative approach to lending.   

By strengthening their risk management technologies and systems, financial institutions are boosting their ability to withstand potential risks and comply with regulatory requirements. 

Additionally, the study pointed out a strong focus on several critical areas in the region’s banking sector, including digital and open banking, blockchain   and mobile payments. 

Tokenization, digital currencies, and sustainable finance are other areas gaining traction. 

“Central banks are enabling banking innovation through implementing regulatory frameworks which are conducive to fintech and open banking,” said Houssam Itani, EY MENA’s banking and capital markets leader, in the statement.   

He added: “The evolving regulatory environment is expected to open the door for measured growth which balances innovation and financial resilience.” 

The study anticipates that GCC banks will maintain their resilience in 2023, and the situation is expected to improve, with sustained oil prices empowering governments to provide economic support.

These were the details of the news MENA banking sector’s profits rise 30% thanks to economic diversification: EY  for this day. We hope that we have succeeded by giving you the full details and information. To follow all our news, you can subscribe to the alerts system or to one of our different systems to provide you with all that is new.

It is also worth noting that the original news has been published and is available at Arab News and the editorial team at AlKhaleej Today has confirmed it and it has been modified, and it may have been completely transferred or quoted from it and you can read and follow this news from its main source.

PREV SDAIA chief calls for strong legal frameworks to mitigate AI risks
NEXT Saudi Arabia issues 54 industrial licenses in March 

Author Information

I am Joshua Kelly and I focus on breaking news stories and ensuring we (“Al-KhaleejToday.NET”) offer timely reporting on some of the most recent stories released through market wires about “Services” sector. I have formerly spent over 3 years as a trader in U.S. Stock Market and is now semi-stepped down. I work on a full time basis for Al-KhaleejToday.NET specializing in quicker moving active shares with a short term view on investment opportunities and trends. Address: 838 Emily Drive Hampton, SC 29924, USA Phone: (+1) 803-887-5567 Email: [email protected]