Arab Banks Net Profit Likely to \'\'Grow 15%\'\'

The aggregate net profit of Arab banks in the region is estimated to expand by 15% to touch $37 billion, chief of a bank forum said here. Union of Arab Banks (UAB) Chairman Adnan Ahmed Yousif, speaking to English language daily Gulf Times said, \"Arab banks are expected to perform well this year on the strength of good economic growth across the region. \"The UAB estimates the combined balanced sheet of 490 Arab banks would increase 10% this year and exceed $3.5 trillion, he said and added that Arab banks were in a much better shape than lenders in the US and Europe. Compared to the banking sector in these continents, Arab banks had not suffered much during the global economic slowdown. This is because the Arab banks did not directly invest in real estate or its derivatives in the US or Europe, he said. Most of the regional investments in these countries were made through sovereign wealth funds (SWFs). \"The real estate portfolio in the Arab banks loan book does not constitute more than 3% to 4%. This is not much. And most of the Arab banks have already written off these,\" he told the daily. On the lessons learnt by the Arab banking industry from the global financial turmoil, Yousif said, \"We should not think the European and the American markets are secure. We must allocate at least one-third of our resources to the Arab region.\" The UAB chairman was also confident that Arab banks would be able to meet capital adequacy requirements under the Basel III proposals.