Bahrain
Kuwait
Oman
Qatar
Saudi Arabia
UAE
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HSBC Middle East was forced to sharply boost its credit provisions in the first half of the year. The bank saw its first-half loan impairment charges and credit risk provisions jump to $391m from $41m a year earlier, but reported $643m in first half, pretax profit in August.
HSBC is the largest foreign bank operating in the UAE, and has 45 branches throughout the UAE, Oman, Bahrain, Qatar, Kuwait, Jordan, Lebanon, Pakistan and the Palestinian Autonomous Area. In addition to the branch network, the bank maintains representative offices in Tehran, Iran and Tripoli, Libya.
This extensive regional coverage is strengthened by another member of the HSBC Group, HSBC Bank Egypt SAE, and by its associated companies: The Saudi British Bank; British Arab Commercial Bank Limited; HSBC Saudi Arabia Limited; SABB Securities Limited; SABB Takaful Co; and Dar Es Saalam Investment Bank.
In August, ratings agency Moody's downgraded HSBC Middle East, citing pressure on the lender's asset quality and profitability in the region, particularly in the UAE. The bank was one of the first in the country to tighten lending conditions for its retail banking operations as the economic crisis hit, and the risk of loan defaults increased.
And earlier this month, the lender announced it was cutting 122 positions in the country, after announcing 80 job cuts earlier in the year. However, chief executive Simon Cooper told Reuters in October that while he expects the trend in non-performing loans to hold steady over the next six months, he believes the region is starting to recover from the global downturn.
"We will continue to see growth in revenues, and NPLs will be level," Cooper said. "The worst is over."
HSBC is the largest foreign bank operating in the UAE, and has 45 branches throughout the UAE, Oman, Bahrain, Qatar, Kuwait, Jordan, Lebanon, Pakistan and the Palestinian Autonomous Area. In addition to the branch network, the bank maintains representative offices in Tehran, Iran and Tripoli, Libya.
This extensive regional coverage is strengthened by another member of the HSBC Group, HSBC Bank Egypt SAE, and by its associated companies: The Saudi British Bank; British Arab Commercial Bank Limited; HSBC Saudi Arabia Limited; SABB Securities Limited; SABB Takaful Co; and Dar Es Saalam Investment Bank.
In August, ratings agency Moody's downgraded HSBC Middle East, citing pressure on the lender's asset quality and profitability in the region, particularly in the UAE. The bank was one of the first in the country to tighten lending conditions for its retail banking operations as the economic crisis hit, and the risk of loan defaults increased.
And earlier this month, the lender announced it was cutting 122 positions in the country, after announcing 80 job cuts earlier in the year. However, chief executive Simon Cooper told Reuters in October that while he expects the trend in non-performing loans to hold steady over the next six months, he believes the region is starting to recover from the global downturn.
"We will continue to see growth in revenues, and NPLs will be level," Cooper said. "The worst is over."
Pipe dreams
Posted by TALAL on 20 December 2009 at 18:19 UAE time
With all due respect the list in not only wrong but misleading as well. I agree with Paddy that you need to come up with more meaningful criteria for ranking Banks as this doesn't work at all. When new financial results are out next year at least 3 on the list may end up up the creek without a paddle.
Posted by TALAL on 20 December 2009 at 18:19 UAE time
With all due respect the list in not only wrong but misleading as well. I agree with Paddy that you need to come up with more meaningful criteria for ranking Banks as this doesn't work at all. When new financial results are out next year at least 3 on the list may end up up the creek without a paddle.
Agree with the list
Posted by SG, Kuwait, Kuwait on 9 December 2009 at 09:50 UAE time
I have been working in the corporate banking field for over 5 years now and the banks listed above are quite secure. Choosing randomly and checking the historic audited financials you will see that these banks have been taking adequate provisions over the years unlike banks like Commercial Bank of Kuwait that took extreme sudden provisions making them reporting losses in 3Q of 09 whereas KD100m for the same period the previous year; that goes to show the type of credit they run. As for all the questions Paddy is asking, well an article that answers all those questions might as well be a book cos you are asking for financial analyses of each bank which could easily need 100 pages or so (4 pages each minimum). This report is a morale booster but is based on financials issued by the best international auditors. and, by the way, i do not work in any of those top banks but i intend to.
Posted by SG, Kuwait, Kuwait on 9 December 2009 at 09:50 UAE time
I have been working in the corporate banking field for over 5 years now and the banks listed above are quite secure. Choosing randomly and checking the historic audited financials you will see that these banks have been taking adequate provisions over the years unlike banks like Commercial Bank of Kuwait that took extreme sudden provisions making them reporting losses in 3Q of 09 whereas KD100m for the same period the previous year; that goes to show the type of credit they run. As for all the questions Paddy is asking, well an article that answers all those questions might as well be a book cos you are asking for financial analyses of each bank which could easily need 100 pages or so (4 pages each minimum). This report is a morale booster but is based on financials issued by the best international auditors. and, by the way, i do not work in any of those top banks but i intend to.
Tangible evidence missing
Posted by Paddy, Dubai, UAE on 26 November 2009 at 00:04 UAE time
The report talks about the performance of each bank at a very high level without delving deep into the numbers. For example, what is the net NPL for each bank in comparison with their assets? What is the exposure ratio (total exposure to the risky sectors out of the total assets) of each bank to risky sectors like Credit Cards, Construction & Real Estate etc? What is the recovery position with respect to Credit Card advances? What is the exposure of each bank (especially UAE and Saudi banks) to the Saad and Algosaibi groups? Have they kept aside provisions against these troubled assets? What has each bank done differently to tide over the financial crisis? HAs there been any fresh capital infusion into any of these banks? What is the Capital Adequacy Ratio of these banks? The lack of transparency with regard to reporting in the Middle East financial sector means that the banks may not have fully reported their bad assets. Maybe the report is intended to be a morale booster to the general public and not exactly based on hard facts.
Posted by Paddy, Dubai, UAE on 26 November 2009 at 00:04 UAE time
The report talks about the performance of each bank at a very high level without delving deep into the numbers. For example, what is the net NPL for each bank in comparison with their assets? What is the exposure ratio (total exposure to the risky sectors out of the total assets) of each bank to risky sectors like Credit Cards, Construction & Real Estate etc? What is the recovery position with respect to Credit Card advances? What is the exposure of each bank (especially UAE and Saudi banks) to the Saad and Algosaibi groups? Have they kept aside provisions against these troubled assets? What has each bank done differently to tide over the financial crisis? HAs there been any fresh capital infusion into any of these banks? What is the Capital Adequacy Ratio of these banks? The lack of transparency with regard to reporting in the Middle East financial sector means that the banks may not have fully reported their bad assets. Maybe the report is intended to be a morale booster to the general public and not exactly based on hard facts.
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