Banking Sector: Becoming More Balanced

Largely owing to massive government intervention and tighter lending practises, the risks to the Qatari banking sector's stability appear to be subsiding. June's Banks Monthly Statement published by the Qatar Central Bank (QCB) shows that the sector's aggregate loan-to-deposit ratio continued to fall (though still remains above 100%, for now), and that loan growth continued to slow. Tighter lending practices could impact bank profitability over the short-to-medium term, but should also help lenders to clean up their balance sheets. Indeed, loan growth was extremely rapid during the oil boom, suggesting that risk management practices could well have been less than

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