Big losses, growing provisions, slowing profit growth: money is no longer easy in the Gulf, as banks’ third-quarter results brutally showed.
Worst hit has been Kuwait’s Gulf Bank, which in mid-November announced a $1.4 billion loss on investments. The source was sales of foreign exchange derivatives to companies that stopped honouring their obligations. But analysts say the dollar’s appreciation has probably caused similar losses at other Gulf financial institutions.
"Perhaps Gulf Bank was more aggressive in providing foreign exchange derivatives. But similar instruments were sold by other banks in the region," says Mardig Haladijian,...
