UAE-listed banks achieved a 5.6% quarter-on-quarter (Q-o-Q) growth rate in the first quarter of 2024, leading the Gulf Cooperation Council (GCC).
Kamco Invest’s GCC Banking Sector Report highlighted this performance, noting that UAE banks also had the highest customer deposits in the region, totaling USD 803.2 billion.
Leading in Net Interest Margins
UAE banks maintained their leadership in net interest margins (NIMs), achieving 3.49% in Q1-2024. This performance surpassed other Gulf nations, with Saudi Arabian banks at 3.18%, Qatar at 3.06%, and Kuwait at 2.87%. The higher NIMs reflect the ample liquidity within UAE banks, which benefit from the tightening interest rate cycle with moderate asset growth.
Return on Equity and Future Outlook
UAE banks also excelled in return on equity (RoE), achieving 16.9% by the end of Q1-2024. This was followed by Saudi Arabian banks at 12.8% and Qatari banks at 12.7%. UAE banks showed significant year-on-year (Y-o-Y) growth in RoE, increasing by 280 basis points due to elevated profits and a relatively smaller increase in total shareholders’ equity.
This robust performance indicates a promising outlook for UAE-listed banks, positioning them as leaders in the GCC banking sector for 2024.
