Gulf banks’ profits

DUBAI: Net earnings of Gulf banks are expected to slide as government spending slows due to a dive in oil revenues, the Standard and Poor’s ratings agency said on Thursday.

Growth in net income declined to four per cent in the second quarter, compared with seven per cent in the first three months of the year and more than 10 per cent in the previous three quarters, S&P said in a report based on a survey of 26 major Gulf banks.

“We expect Gulf banks’ net income growth to decline below 10 per cent in 2015 and potentially slow further in 2016,” the ratings agency said. The ‘good’ earnings in the first half were due in part to declining credit losses.