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‘Basel III hit is likely on Qatar banking industry’ 

November 25, 2014
Santhosh V Perumal, Gulf Times

Banking industry in Qatar will be one of the “hardest hit” by the stringent Basel III capital norms, which is expected to put brakes on the Middle Eastern lenders’ growth.

“Fast-growing players in Qatar, Kuwait, and the Levant will be the hardest hit, as any growth in assets requires accompanying growth in Tier 1 capital to meet new standards,” Strategy& said in a report.

By contrast, countries that have witnessed relatively slower growth in recent years — including Bahrain, Saudi Arabia, and the UAE — will have little difficulty meeting or even exceeding required capital adequacy ratio if they continue along that trajectory, it said.

However, the new capital requirements will hinder their growth if they want to ramp up regional and international expansion. Therefore, they too would need to rethink their business and asset mix with an eye to strategic capital requirements, the report added.

Read more: Gulf Times

 
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