World’s Best Banks 2013: Middle East

By Thomas Clouse, Jonathan Gregson, Antonio Guerrero & Gordon Platt


Many of the largest banks in the Middle East posted record earnings in 2012, as they continued to pursue conservative lending policies in a region that is growing faster than most, thanks to high oil prices and extravagant government spending. Investment banking fees in the region rose 19% last year, and debt issuance was up 26%, according to Thomson Reuters. Mergers and acquisitions doubled to $20 billion.


Countries with rising oil production, such as Iraq and Libya, or large populations, including Egypt and Saudi Arabia, are attracting the interest of bankers seeking to support growth opportunities in the medium term. In the Gulf Cooperation Council (GCC) countries, the banking industry is well developed and efficient, and plans for deepening the capital markets are moving forward. Islamic finance continues to be one of the fastest growing sectors in the financial markets. Sukuk issuance is booming, and conventional banks are increasing their purchases of shariah-compliant products and financial institutions.



National Bank of Kuwait

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“Dabdoub, NBK: Last year was a turbulent year for banking in Kuwait. Government spending was insufficient and new project tenders remained behind schedule, leading to slower economic activity and an underperforming stock market.”

– Ibrahim Dabdoub, group CEO, National Bank of Kuwait


National Bank of Kuwait earned more than $1 billion in 2012 for the third year in a row, despite ongoing economic and political challenges at home and in the region. NBK strengthened its presence in Kuwait’s Islamic banking market by increasing its stake in Boubyan Bank to 58.4%. The bank also boosted its presence in the region, with more focus on its GCC operations. NBK’s international banking profits rose by 22.7% in 2012 from a year earlier.


Ibrahim Dabdoub, NBK’s group CEO, says: “Last year was a turbulent year for the banking sector in Kuwait, as the operating environment remained stagnant. Government spending was insufficient and the tendering of new projects remained behind schedule, leading to slower economic activity and an underperforming stock market.”


There should be a general improvement in the outlook for 2013, as the government adopts a more dynamic fiscal policy, accelerating spending on mega projects, Dabdoub says. NBK will continue its focus on core banking operations, in Kuwait and regionally, he says. Operating income rose to $2.3 billion in 2012 from $1.9 billion in 2011.


Global Finance named NBK among the world’s 50 safest banks in 2012 for the sixth year in a row. NBK is the largest bank in Kuwait, with 64 branches in the country and an additional 109 branches around the world.


Ibrahim Dabdoub, group CEO /



Ahli United Bank

Ahli United Bank earned a record $336 million in 2012, an 8.1% increase over 2011. The Bahrain-based group is active throughout the region, with full banking operations in Kuwait, Egypt, Iraq, Oman and Libya, in addition to a UK subsidiary. The past year was an active one for AUB, which launched Islamic banking in Oman and increased its capital through rights offerings. Ahli Bank Oman opened five shariah-compliant branches, following a $65 million rights issue. AUB also increased its shareholding in Commercial Bank of Iraq to 68.9% from 59.7%. Ahli United Bank Egypt completed a $62 million rights issue. In February 2013, AUB sold its 29.4% stake in Ahli Bank—Qatar to the Qatar Foundation, generating a profit of $213 million.


Adel El-Labban, group CEO and managing director /


Commercial International Bank

Commercial International Bank is Egypt’s largest and most profitable private-sector bank, with 156 branches and a leading market share in loans and deposits. Institutional investors hold 80% of CIB’s stock, and BNY Mellon manages its global depositary receipt program, valued at approximately $360 million. CIB is a universal bank, and its clients include businesses of all sizes, as well as institutions and individuals. Its CI Capital subsidiary is a full-service investment bank. The debt capital markets division’s major deals last year were in the petrochemicals, oil and gas, telecommunications and real estate sectors. CIB’s earnings rose 38% in 2012 to a record $328 million.

Hisham Ezz Al-Arab, chairman and managing director /


Commercial Bank of Iraq

Commercial Bank of Iraq is one of the largest private-sector banks in Iraq. It has nine offices in Baghdad and one in Basra. It was the first bank to issue MasterCard credit and debit cards in Iraq. The bank offers retail and commercial banking services, including loan syndications and foreign exchange, trade finance and equity trading. Bahrain’s Ahli United Bank holds a 68.9% stake in CBIQ, which plans to increase its capital through a rights offering. AUB says it views Iraq as a high-potential market over the long term, in view of the country’s increasing oil production and an improving security situation.

Nouri Aldubaysi, CEO /


Bank Hapoalim

Bank Hapoalim, Israel’s largest bank, saw its profits squeezed last year by rising costs and the need to set aside additional capital. The bank’s Tier 1 capital ratio rose to 8.9% at the end of last year from 7.9% at the end of 2011. Although earnings slipped in 2012, revenues and assets rose. The Tel Aviv–based bank holds more than one-third of the assets of the Israeli banking system, and it is the leading bank in both the retail and corporate sectors. It has 280 branches and eight regional business centers in Israel and operations in 20 countries.

Zion Kenan, president and CEO /


Arab Bank

Arab Bank posted a 15% rise in 2012 earnings to $352 million on higher revenues and a decline in provisions for doubtful loans. The bank’s management attributed the improved results to a conservative approach to lending and a diversified operating model. Based in Amman, Jordan, Arab Bank has a network of more than 600 branches in 30 countries. “It’s important to keep high liquidity, which is a main pillar of the bank’s solid financial position,” says Nemeh Sabbagh, Arab Bank’s chief executive officer. Nonperforming loans are fully covered by provisions, he says. The bank’s capital adequacy ratio was more than 15% at the end of 2012.

Nemeh Sabbagh, CEO /


National Bank of Kuwait

National Bank of Kuwait is the country’s leading bank in terms of market share, profitability and quality of assets. The bank is increasing its share of Kuwait’s fast-growing Islamic finance market through its majority ownership of Boubyan Bank.

Since 1991, NBK’s market share of foreign companies doing business in Kuwait has never fallen below 70%. The bank also has a leading share in Kuwait’s trade finance market of approximately 40%. National Bank of Kuwait maintained a leading share in the regional corporate and investment banking market in 2012, including advising Qtel on its acquisition of Wataniya Telecom.

Ibrahim Dabdoub, group CEO /


Bank Audi

Bank Audi is the leading bank in Lebanon in terms of assets, deposits, loans, equity and profitability. The bank’s return on common equity was 16.6% in 2012, and earnings rose 5% to $384 million. Assets rose 8.9% to $31.3 billion. The rise in assets in part reflects the new subsidiary it launched in Turkey, Odeabank, which began operations in November 2012 and now has nine branches, with plans to add an additional 23.

Bank Audi has 80 branches in Lebanon, which is more than any other bank. It also has an additional 82 branches throughout the region, including 32 in Egypt and 22 in Syria. The share of consolidated assets abroad rose to 32.3% at the end of 2012 from 28% a year earlier.

Samir Hanna, group CEO /



BankMuscat’s earnings rose 18.5% last year, the result mainly of an increase in net interest income, reflecting asset growth. The return on average equity improved marginally to 15.4%. BankMuscat is Oman’s largest bank, with 136 domestic branches and a market share of about 38%. It has a direct or indirect presence in all six Gulf Cooperation Council states and a representative office in Singapore. Its investment banking business earned record fees last year and closed debt and equity deals that raised a total of $1.5 billion. Meethaq, BankMuscat’s Islamic window, has introduced shariah-compliant savings and home finance products.

AbdulRazak Ali Issa, CEO /


Bank of Palestine

Bank of Palestine is the largest bank in Palestine, with a network of 48 branches in the West Bank and Gaza and assets of more than $2 billion. The bank has a market share of approximately 23% of deposits and credit facilities in Palestine and more than 500,000 customers. It is the sole agent for Visa and MasterCard in Palestine, with more than 5,000 point-of-sale stations. Last year it introduced a Palestinian payments solution that enables customers to pay utility bills and top up mobile-phone credit at the POS terminals. Recently, the bank was active in some of the largest project finance loan syndications, such as Wataniya Mobile Palestine and the Mövenpick Hotel, Ramallah.

Hashim Shawa, chairman and general manager /


Qatar National Bank

Qatar National Bank earned a record $2.3 billion in 2012, an increase of 11% over 2011. Loans and advances rose 29%. The ratio of nonperforming loans to total loans was 1.3%, among the lowest in the region. The bank is 50% owned by sovereign wealth fund Qatar Investment Authority. QNB continued its international expansion in 2012 by acquiring the entire share capital of National Société Générale Bank—Egypt, with assets of $10.4 billion and 160 branches. It also acquired a 49% interest in Bank of Commerce and Development in Libya. In addition, QNB boosted its stakes in Iraq-based Mansour Bank to 51% from 23%, and in UAE-based Commercial Bank International to 40% from 24%. Earlier this year, QNB raised its interest in Tunisian Qatari Bank to 99.96%.

Ali Shareef Al-Emadi, group CEO /


Samba Financial Group

Riyadh-based Samba Financial Group, one of Saudi Arabia’s largest banks, increased lending by 17.6% in 2012. The bank’s full-year profits rose 0.7% to $1.2 billion, while return on equity was 14.5%. Samba has one of the largest corporate banking portfolios in the Gulf Cooperation Council market. Corporate banking services are also provided through the bank’s presence in the United Arab Emirates, Britain, Pakistan and Qatar. The corporate banking group’s earnings rose 5.6% in 2012. Samba’s dedicated Islamic banking division offers a full range of products for retail, private and corporate and investment banking clients. Samba was a co-manager of Qatar’s $4 billion dual-tranche sukuk last year.

Eisa Al-Eisa, chairman /


National Bank of Abu Dhabi

Highly rated National Bank of Abu Dhabi has made Global Finance’s listing of the world’s 50 safest banks every year since 2009. NBAD has 120 branches in the United Arab Emirates, plus an international network of 50 branches in 14 countries. It opened a representative office in Shanghai last year and made Kuala Lumpur its regional hub for Southeast Asia. NBAD plans to open 30 branches in Malaysia in the next decade and to expand into Singapore and Indonesia.

Michael Tomalin, group CEO /


Arab Bank Yemen

Arab Bank Yemen provides financing to all sectors of the economy, with a focus on trade and construction, including infrastructure development. The bank was the first to introduce ATMs in Yemen, which has a population of 25 million. The country recently began a national dialogue to prepare for a new constitution and elections in February 2014. The interim government’s new economic plan calls for creating six semi-autonomous regions. Any new investments in infrastructure under the government’s plans could be advantageous for Arab Bank Yemen.

Omar Ibrahim Al-Sous, country manager /

alt Awards: World’s Best Banks 2013