KPMG recently released its fifth edition of the ‘GCC listed banks’ results’ report, which analyses the published results of listed commercial banks across the region for the year ended December 31,2019. The report, titled ‘New Age Banking,’ has shown that the banking sector in Oman has been resilient in the face of tightening operating conditions since the decline in oil price.

From the results presented, Banks have maintained sufficient capital buffers and remained fairly liquid. The Oman banking sector experienced a growth of 4.3 percent in total assets for the top eight banks, with a 4.7 percent decline in profits mainly due to higher than expected credit losses in 2019. The average CAR stood at 17 percent in 2019, reflecting sufficient capital buffers.

Speaking about the report, Kenneth Macfarlane, Partner in Charge, KPMG Oman, commented: “Our analysis has identified an overall positive trend for the financial sector in Oman, which, given the unique circumstances the region has witnessed in recent years, is particularly impressive. This reflects the continued resilience of the banking sector.”

On another note, the Covid-19 pandemic is having an unprecedented impact on financial markets globally and locally and creating a unique situation for the industry. Experts agree that the sector will be dealing with the effects of this pandemic for the foreseeable future, leading the banking sector to evolve, and only agile and flexible banks that are willing to transform will succeed and secure future growth.

“In order for banks to emerge stronger in light of the current pandemic, they will need to evolve faster than ever before and offer innovative ‘new age banking’ solutions, such as artificial intelligence and digital branches. Partnering with fintech solution providers will help them advance their business platforms,” added Macfarlane.
Additional insights in the report find that regional banks have remained resilient in terms of profitability and asset growth. They do, however, need to continue to focus on managing the credit quality of their loan portfolios to ensure this resilience can be maintained.

The report titled ‘GCC listed banks’ results: New Age Banking, analyses the results of selected listed banks in the Kingdom of Bahrain, the State of Kuwait, the Sultanate of Oman, the Kingdom of Saudi Arabia, the State of Qatar and the United Arab Emirates. It summarizes banks’ results against selected key performance indicators for the year ended December 31, 2019 and compares these with the same information for the year ended December 31, 2018. The report can be downloaded here: https://home.kpmg/ae/en/home/insights/2020/05/gcc-listed-banks-results.html