Banking Sector: Bright Outlook Across Region
BMI View: The GCC will remain the outperformer across MENA's banking sector over the coming years, though growth rates will slow as the effects of government stimulus wear off. Elsewhere, we are forecasting an uptick in banking sector assets on the back of low base effects and, in the case of Egypt and Iran, a decrease in political risks.
We hold a broadly positive outlook on banking sectors across the Middle East in 2014 and beyond, and expect a slight convergence in growth rates due to base effects. We maintain our view that the Gulf will be the outperformer in the region as growth will be buoyed by significant government spending particularly on large-scale infrastructure projects, particularly in Saudi Arabia and Qatar. Outside of the GCC we forecast an uptick in credit growth in Egypt and Iran, due primarily to a decrease in political risks.
GCC To Outperform
|GCC To Remain In Front|
|Middle East - Banking Sector Credit Growth % chg y-o-y|