The UAE had the largest banking sector in the Arab World towards the end of 2009, controlling nearly 18 per cent of the combined financial resources, and emerging as the top lender in the region, according to banking data.
Emirates NBD (ENBD) maintained its position as the biggest bank in the region in terms of assets, which stood at about $79 billion (Dh290bn) at the end of September 2009, showed figures by the Beirut-based Union of Arab Banks (UAB).
In a study on banks in the Gulf Cooperation Council (GCC), UAB said banks in the six GCC states controlled more than half the total assets, deposits, loans and capital of the Arab World's 470 banks at the end of September 2009.
Out of 88 Arab banks listed among the world's top 1,000 banks, 56 banks were from the GCC countries – 17 from the UAE, 11 each from Saudi Arabia and Bahrain, eight from Kuwait, six from Qatar and three from Oman. The report showed the GCC nations, which sit atop 45 per cent of the world's recoverable oil deposits, had more than half the total number of Arab banks, with Bahrain topping the list with 117 banks. It was followed by the UAE with 52 banks, Oman with 17 banks, Qatar with 16 banks and Kuwait and Saudi Arabia with 15 and 12 banks, respectively.
"UAE banks control the largest banking sector in the Arab World, with their combined assets standing at $408bn at the end of September 2009. They accounted for nearly 31.9 per cent of the GCC's total bank assets and about 18 per cent of the combined assets of Arab banks," the study said.
"ENBD maintained its position as the largest bank in terms of assets, which were estimated at about $79bn at the end of September last year. It was also the largest in terms of loans and second by deposits and shareholders equity. The Saudi National Commercial Bank was second by assets and first by shareholders equity during that period."
A breakdown showed Saudi Arabia, the world's dominant oil power, controlled the second largest Arab bank assets of about $360.3bn at the end of September 2009. Bahrain, which has the largest offshore banking industry in the Middle East, came third with $224bn, followed by Kuwait, Qatar and Oman.
The report showed GCC banks also controlled more than half the total deposits with Arab banks, with about $660bn at the end of September 2009. Loan-to-deposit ratio in the GCC stood at around 114 per cent at the end of September last year compared with 118.7 per cent at the end of 2008.
The UAE Central Bank has played a crucial role in protecting the country's banks in the aftermath of the global financial crisis through measures that included pumping massive liquidity into the financial sector, a report by the Union of Arab Banks (UAB) said.
"The regulations issued by the central bank, along with other measures, provided maximum protection and were commensurate with global banking regulations. These have resulted in growth in financial resources, including deposits, and good performance in 2008 and the first three quarters of 2009," it said.
"All indicators for the UAE banking sector show they are based on solid pillars. Nearly 77.5 per cent of financing sources are secure, deposits recorded 9.7 per cent growth by the end of Q309 while capital surged by 33 per cent. Capital adequacy ratio at the end of September 2009 was as high as 13 per cent, far higher than the eight per cent floor recommended internationally," it added.
Keep up with the latest business news from the region with the Emirates Business 24|7 daily newsletter. To subscribe to the newsletter, please click here.