Saudi banks more profitable than most GCC peers: Report

March 16, 2017

Jeddah, Mar 16: Moody’s Investors Service has revised its outlook for the Saudi banking system to stable from negative.

Saudi banks are more profitable than most of their Gulf Cooperation Council (GCC) peers, with an average ratio of net income-to-tangible assets of 1.9 percent as of 2016, on a par with Qatari banks, said a Moody’s report issued on Wednesday.

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The stable outlook reflects high risk-absorption buffers and easing funding pressures, as Saudi banks’ credit profiles are expected to remain broadly stable over the next 12 to 18 months, the report said.

“Despite low oil prices, which we expect to fluctuate between $40 and $60 a barrel over the next 18 months, and cuts in oil production, the Saudi economy will gradually recover, supported by government spending,” said Olivier Panis, a vice president at Moody’s.

He added that as a result Saudi banks’ liquidity and funding conditions would improve.

“Although profitability and loan performance will continue to soften, Saudi banks will maintain robust capital and loss-absorption buffers compared to regional and international peers over the outlook horizon,” the analyst said.

According to Moody’s, the operating environment for Saudi banks will recover. While the rating agency expects real gross domestic product (GDP) growth to contract by 0.2 percent in 2017, increased government spending and projects to diversify economic output will support a gradual recovery of the non-oil economy, which will grow by 2 percent in 2017 versus 0.2 percent in 2016.

Consequently, Moody’s expects credit growth to remain low at 3 percent in 2017, but it is likely to gradually pick up from 2018.

Analysts expect non-performing loans (NPLs) to increase to 2.5 percent of the gross loans over the outlook horizon, from a low level of around 1.4 percent as of September 2016.

Although banks will also remain vulnerable to high single-party exposures and opacity in the corporate sector, they will maintain the highest level of loan-loss provisioning coverage in the region, the report said.

According to Moody’s, Saudi banks will maintain a solid operating performance, although subdued loan growth, rising provisioning charges and lower fee and commission income might weigh on profits.

The impact will be partly mitigated by stable margins, low operating costs and easing pressure on funding costs. Despite Moody’s expectation of reduced profitability, subdued loan growth will support capital adequacy, which will strengthen from already strong levels.

Moody’s said that access to funding will improve owing to liquidity injections from international sovereign debt issuances, the clearing of large volumes of overdue payments to contractors by the government in the fourth quarter of 2016 and modest credit growth.

However, deposit growth will remain low until economic activity picks up more materially in 2018.

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News Network
March 26,2024

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There is no let-up in the Israeli aggression on the Gaza Strip despite a UN Security Council resolution demanding an “immediate ceasefire.”

Israel carried out air raids and artillery strikes on several parts of Gaza on Tuesday, hitting residential buildings and gatherings of displaced people, “killing and wounding hundreds of people”, the Palestinian Information Center said.

Among the victims are 15 people, including four women and children, who were killed in an attack on a house in the neighborhood of Mosbeh, north of Rafah.

Media reports also said that fighting on the ground continued unabated.

That’s while the UN Security Council on Monday adopted a resolution for an “immediate ceasefire” for the ongoing Muslim holy month of Ramadan.

The resolution was put forward by the 10 non-permanent members of the UN Security Council. The US abstained and the 14 other council members all voted in favor of it.

After the vote, UN Secretary-General Antonio Guterres wrote on social media platform X that failing to implement the resolution “would be unforgivable.”

Palestinian resistance movements have welcomed the resolution, but Israel’s minister for military affairs Yoav Gallant said Israel will not stop its attacks in Gaza. 

“We will operate against Hamas everywhere – including in places where we have not yet been,” Gallant said.

Israel’s foreign minister, Israel Katz, also said in a post on X that the attacks will continue until all the captives taken by Hamas during its October 7 blitz are released.

Israel unleashed its war on Gaza on October 7 after the Palestinian Hamas resistance group carried out Operation Al-Aqsa Storm against the usurping entity in retaliation for its intensified atrocities against the Palestinian people.

Since the start of the offensive, the Tel Aviv regime has killed more than 32,300 Palestinians and injured over 74,000 others.

The Tel Aviv regime has also imposed a “complete siege” on the territory, cutting off fuel, electricity, food, and water to the more than two million Palestinians living there.

Francesca Albanese, the UN special rapporteur on human rights in the Palestinian territories, said Israel has committed acts of genocide in Gaza.

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News Network
March 25,2024

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A Palestinian woman has recounted terrifying incidents after Israeli military forces raided al-Shifa hospital in Gaza City last week, saying the occupying regime’s soldiers are raping Palestinian women before killing them.

Jamila Al-Hisi, an eyewitness who was besieged in the medical complex and managed to finally get out, said on Saturday that women have been subjected to rape, starvation, torture, and extrajudicial execution, adding that the International Committee of the Red Cross (ICRC) is doing nothing.

She went on to say that Israeli troops have “forced 65 families to leave the area around the al-Shifa Medical Complex whilst burning and killing entire families,” noting that they have burned a building where Palestinian civilians were taking shelter.

“We don’t even have water to break our fast, and we don’t know where to go,” Hisi said, stressing that the displaced people in the compound have not found food or water for six days.

She further called on the Red Cross to provide water for the children and the sick who are being forced to drink dirty water and eat rotten food.

Palestinians are being forcibly displaced by Israeli occupation forces from the area surrounding al-Shifa Hospital in northern Gaza, Hisi said, adding, “We are trapped amid continued Israeli shelling.”

The latest development comes as the Israeli military continues to carry out air strikes and artillery shelling in and around the al-Shifa Hospital for the seventh day in a row.

On Monday, heavily armed Israeli forces stormed the al-Shifa hospital using tanks and drones, claiming that the Palestinian resistance movement Hamas is using the facility to “conduct and promote terrorist activity.” Later that day, Israel said that “terrorist forces” were firing at Israeli troops.

The Ministry of Health in Gaza said at the time that about 3,000 people were inside al-Shifa seeking refuge and that those attempting to leave were being targeted by snipers and fire from helicopters.

Ever since the Israeli military raided the hospital last week, reports have suggested unspeakable atrocities being carried out against the doctors, nurses, and general staff as well as the thousands of displaced people there.

Israelis have admitted to executing 140 people inside al-Shifa, including paramedics, patients and wounded whilst the siege is still ongoing after seven days with mass arrests.

Meanwhile, a group of Palestinian activists have circulated a shocking story about the Israeli soldiers raping a pregnant woman in the al-Shifa hospital, alongside Hisi’s revelation.

Watan-Palestinian activists quoted the husband of a woman who was raped by Israeli forces as saying that “They ordered her to undress and began to beat her… She told the military she was five months pregnant, not to beat her, but they continued to beat her.”

“After hours, they took out all the women except the pregnant woman, and her children… They took her in front of her husband and children and raped her, ordering the men not to close their eyes or they would be shot.”

Israel waged the war on the Gaza Strip on October 7 after Hamas carried out the surprise Operation Al-Aqsa Storm into the occupied territories in response to the occupying regime’s intensified crimes against the Palestinian people.

Since the start of the aggression, the Tel Aviv regime has killed at least 32,226 Palestinians, most of them women and children, and injured another 74,518 individuals.

Tel Aviv has also imposed a “complete siege” on Gaza, cutting off fuel, electricity, food, and water to the more than two million Palestinians living there.

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News Network
March 14,2024

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The UN agency for Palestinian refugees (UNRWA) says at least five people, including a staff member, were killed and 22 others wounded after Israeli forces targeted a food distribution centre in Rafah in the southern Gaza Strip.

UNRWA Commissioner General Philippe Lazzarini in a statement on Wednesday said that the strike hit one of the very few remaining UNRWA distribution centers in the eastern part of Rafah.

“Today’s attack on one of the very few remaining UNRWA distribution centers in the Gaza Strip comes as food supplies are running out, hunger is widespread and, in some areas, turning into famine,” Lazzarini said.

“Every day, we share the coordinates of all our facilities across the Gaza Strip with parties to the conflict," he continued.

He said the attack was carried out even though "the Israeli Army received the coordinates including of this facility yesterday."

Lazzarini further urged the protection of the UN, its staff, and its premises and called for an independent investigation.

Israel acknowledged an airstrike on a food aid distribution center in southern Gaza, which it claimed targeted and killed a high-ranking member of Hamas. 

Meanwhile, the statement by the UNRWA head added that since October 7, at least 165 team members have been killed while in the line of duty and more than 400 people sheltering in UN buildings also lost their lives due to Israel's attacks.

More than 150 of the agency’s facilities, including schools and shelters, have been hit in the war, with some destroyed, and UNRWA staff have reportedly been mistreated and humiliated while in Israeli detention centers, according to the UNRWA.

Six aid seekers killed in Israeli attack

Separately, the health ministry in the Gaza Strip said six people were killed in the latest attack on Palestinians waiting for humanitarian aid at the Kuwait Roundabout in Gaza City.

The Wafa news agency said some 83 people who were wounded in the attack have been transferred to the al-Shifa Medical Complex in the city.

Over the past weeks, Israeli forces have increased their offensives on the Kuwait Roundabout, an area where large groups gather to wait for aid deliveries.

Israeli forces killed 11 people waiting for food aid at the roundabout on Monday night.

The Israeli military has restricted the delivery of humanitarian supplies to northern Gaza for weeks, and thousands of children are going without sufficient food and medication.

The prevention of aid convoys comes as humanitarian officials have already issued a dire warning, stating that unless a ceasefire is implemented and aid is significantly increased, the toll of malnutrition and disease is expected to rise, leading to an alarming loss of lives.

So far, the Tel Aviv regime has killed at least 31,272 Palestinians, mostly women and children, and injured 73,024 others.

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