The Middle East is among the fastest-growing regions in the world for banking and financial services. Financial institutions across the region are in the midst of heavily investing in order to compete globally. Indeed, in 2014, the performance of Middle East banks clearly exceeded the results of most of their international peers.
A study released at the end of March 2015 by leading advisory firm Boston Consulting Group (BCG) revealed that the banking industry in the Middle East experienced a 10-percent revenue growth in 2014. Banks exhibiting the biggest improvement in revenues from 2013 were those from the UAE (United Arab Emirates) with 14 percent, while banks in Oman and Qatar also produced double-digit growth. The spread of profit among countries was more diverse—the UAE and Kuwait enjoyed profit increases of more than 20 percent, while Bahrain saw profits fall.
Much of the strong showing by Middle East lenders has been attributable to major customer segments such as retail and corporate banking, which increased on 2013’s levels by 7.9 percent and 8.8 percent respectively. International business and treasury also put in strong performances over the 12 months.
Another notable feature of the region’s banking success is that the majority of the leading lenders are home-grown. Some of the most profitable banks during the first quarter of this year were Dubai’s Emirates NBD, which reported a 60-percent profit; Qatar National Bank; Abu Dhabi Commercial Bank and Abu Dhabi’s First Gulf Bank. There seems to be a growing gap between domestic lenders and foreign banks with subsidiaries in the region. This can partly be explained by several of the foreign lenders still being involved in post-crisis restructuring and trimming down of operations in regions such as the Middle East in order to focus on core businesses.
The credit-ratings agency Fitch released a statement in April highlighting recent positive growth within the banking sector in sub-Saharan Africa. Much of this has been driven by strong growth in credit, resulting from a buoyant demand in financing for infrastructure projects and a healthy private sector. Even banking sectors in oil-exporting countries, where one might expect lower commodity prices to have triggered loan contractions, are seeing stronger credit demand.
Nigeria, for example, saw loan growth increase by 25 percent in 2014, where, according to Fitch, private consumption and non-oil service sectors are supporting credit demand. Angola, another major oil economy, is also seeing considerable loan growth; although with public-sector investment being a priority in the country, many of the borrowers have been government entities.
Africa in particular has been leading the way in mobile banking for the rest of the world. While providing access to bank branches and a more extensive range of financial services for most sub-Saharan African populations has remained a challenge, mobile banking has developed strongly over the last few years to somewhat mitigate these problems. Over 16 percent of the region reportedly uses mobile phones to pay bills and make cash transfers, substantially more than the worldwide figure of 5 percent. A new service has also recently been launched in Tanzania that allows customers to earn interest on their pay-as-you-go phone credit balances, illustrating the innovation being fostered in the mobile-banking field in Africa.
Encouragingly, it is not just consumer banking in which Africa has been making headlines—investment banking might also be entering an exciting new growth phase. The flurry of deal-making activity has been boosted in the past year by the arrival on the continent of private-equity giants such as The Carlyle Group, KKR and Blackstone. Traditionally the only investment-banking hub for sub-Saharan Africa was near Johannesburg, South Africa. Today, however, M&A (mergers and acquisitions) teams are located in Lagos, Nairobi and even Maputo in Mozambique, a clear indication that investment-banking activity is spreading throughout Africa.
The International Banker 2015 Banking Awards recognises the best banking institutions and individuals in the Middle Eastern and African regions that have set the bar for industry excellence. The Awards recognise the institutions that drive global economic commerce, create capital within their region and opportunities for economic growth, while maintaining a high level of regulatory compliance and corporate governance.
>>>MIDDLE EAST AWARD WINNERS
BANKING CEO OF THE YEAR
Middle East
Adnan Chilwan
Dubai Islamic Bank
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BEST CUSTOMER SERVICE
PROVIDER OF THE YEAR
Middle East
National Bank of Kuwait
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Best Banking Group Dubai
Emirates NBD
Best Banking Group KSA
Samba Financial Group
Investment Bank Of The Year Oman
Bank Muscat
Investment Bank Of The Year Abu Dhabi
First Gulf Bank
Commercial Bank Of The Year Bahrain
National Bank of Bahrain
Commercial Bank Of The Year Egypt
Banque du Caire
Commercial Bank Of The Year Jordan
Arab Bank
Commercial Bank Of The Year Kuwait
Gulf Bank
Commercial Bank Of The Year Oman
BankDhofar
Commercial Bank Of The Year Qatar
The Commercial Bank of Qatar
Private Bank of The Year Dubai
Emirates NBD
Private Bank of The Year Kuwait
National Bank of Kuwait
Private Bank of The Year Qatar
International Bank of Qatar
Innovation In Retail Banking Bahrain
Eskan Bank
Innovation In Retail Banking Dubai
Dubai Islamic Bank
Innovation In Retail Banking Egypt
Banque Misr
Innovation In Retail Banking Kuwait
Gulf Bank
Innovation In Retail Banking Oman
Bank Muscat
Innovation In Retail Banking Qatar
International Bank of Qatar
Best Islamic Bank Qatar
Qatar Islamic Bank
Best Practice Investor Relations Bahrain
Ahli United Bank
Best Practice Investor Relations Saudi Arabia
Samba Financial Group
Best Practice Investor Relations Lebanon
Bank Audi
>>>AFRICA AWARD WINNERS
BANKING CEO OF THE YEAR
Africa
Sizwe Errol Nxasana
FirstRand
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BEST CUSTOMER SERVICE
PROVIDER OF THE YEAR
Africa
Zanaco
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Best Banking Group Morocco
Attijariwafa Bank
Best Banking Group Nigeria
Access Bank
Investment Bank Of The Year Kenya
Faida
Investment Bank Of The Year Nigeria
Rand Merchant Bank
Investment Bank Of The Year South Africa
Standard Bank
Commercial Bank Of The Year Kenya
KCB Bank
Commercial Bank Of The Year Mauritius
Mauritius Commercial Bank
Commercial Bank Of The Year Mozambique
BAI
Commercial Bank Of The Year Namibia
Bank Windhoek
Commercial Bank Of The Year Nigeria
GTBank
Commercial Bank Of The Year Tanzania
Bank M
Commercial Bank Of The Year Zambia
Zanaco
Private Bank of The Year Nigeria
Firstbank
Private Bank of The Year South Africa
Investec
Innovation In Retail Banking Kenya
KCB Bank
Innovation In Retail Banking Mali
BICIM
Innovation In Retail Banking Mauritius
Mauritius Commercial Bank
Innovation In Retail Banking Nigeria
FirstBank
Innovation In Retail Banking Senegal
Banque Atlantique
Best Practice Investor Relations Uganda
Crane Bank
Best Practice Investor Relations Kenya
KCB Bank
Best Practice Investor Relations Morocco
Attijariwafa Bank
Best Practice Investor Relations Nigeria
GTBank