Saudi-listed banks posted a quarterly increase of USD 338.4 mn in net income during the quarter, according to Kamco Invest’s banking sector quarterly report (pdf). UAE-listed banks came on top, growing 11.8% (USD 639.6 mn), while Bahraini banks rounded out the top three with USD 72.6 mn in additional net income.

Saudi banks saw customer deposits rise 4.8% q-o-q in 1Q, posting the third strongest growth in deposits during the quarter, behind the UAE (6.7% at USD 903.8 bn, and Qatar (6.1% at USD 438.9 bn). Bahraini, Omani, and Kuwait banks announced a bit slower customer deposit growth throughout the three-month period.

Saudi Arabia remained the leader of credit growth in the GCC: The kingdom registered a 16.3% y-o-y growth in outstanding credit facilities, marking the strongest double-digit annual growth in the region. The UAE’s credit growth in February 2025 showed a larger y-o-y growth of 24.1%, according to the report.

Burgeoning lending growth in the region is a sign of “a strong project pipeline, although aggregate contracts awarded during the quarter showed a y-o-y decline of 26.8% to reach USD 52.4 bn in 1Q-2025,” the report said. Only the UAE and Kuwait recorded “health growth” in the contracts awarded, while the rest of GCC countries posted declines during the quarter. Net loans posted a sequential growth of 4.1% during the quarter to reach USD 2.2 tn, the highest in 15 months, while gross loans grew 3.6%, Kamco said.

GCC banking sector bottom-line growth held steady during the first quarter of 2025, rising by 7.1% q-o-q and 8.6% y-o-y to hit a new record high of USD 15.6 bn. “The increase came despite a decline in net interest income during the quarter and was mainly led by higher non-interest income, lower operating expenses as well as a sharp seasonal decline in impairments during the quarter,” Kamco said. The drop in net interest income was triggered by rate cuts during the second half of 2024 “with aggregate yield on credit for the GCC banking sector falling by 5 bps to 4.16% in 1Q 2025 as compared to 4.21% in 4Q of 2024.”

The GCC banking sector’s aggregate topline also reached a new record high of USD 34.6 bn during the quarter — though growth was the weakest in four quarters at 0.04%, according to the report. “The flattish growth was led by a decline in revenues reported by banks in Kuwait and Oman that almost fully offset the increase in revenues registered in other GCC countries,” the report said. Qatari banks saw the biggest increase in revenues with an increase of 2.1% q-oq, followed by Saudi at 1.6%, and UAE at 0.6%.

Total customer deposits reported by listed GCC banks hit a new record high of USD 2.65 tn by the end of 1Q, marking 5.1% q-o-q growth, while y-o-y growth came in at 9.9%. “This was one of the biggest quarterly growths recorded in the GCC and was most likely led by volatility in financial markets that led to an increase in flows towards regional banks deposits,” according to the report.

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