Dubai Technology and Media Free Zone Authority THE ACADEMY AT DIFC ACT TODAY, BE READY FOR THE BUSINESS OF TOMORROW. LEADERSHIP | BUSINESS | FINANCE | FINTECH The Academy brings you the following courses from renowned international institutions to help you prepare for the business of tomorrow. London Business School London Business School CITY University of London Merger and Acquisitions Leading Teams for Emerging Leaders Finance for Non-Financial Leaders 26 – 29 Nov 2018 19 – 22 Nov 2018 28 Feb – 2 Mar 2019 Places are limited, book your space in one of our courses now by visiting: academy.difc.ae | #TheAcademyAtDIFC DIFC_A4 Ad_Banker ME_EN_AW.indd 1 14/08/2018 17:21 elcome to the ninth edition of the BME100. For almost a decade, the BME100 has served as a benchmark for financial institutions in the W Middle East. The BME100 is a ranking of financial institutions licensed and domiciled within the Middle East region. To be included in this ranking an institution must have its head office based INTRODUCTION in the Middle East and be regulated by one of the region’s central banks. Every year, in the second quarter of the year, we undertake a study of published audited financial reports from financial institutions in the region. This year we have adopted a rigorous new methodology, which you can read about in detail from page six. Because this marks a new chapter for the BME100, we won’t draw on any comparisons to last year’s rankings. Instead, we will simply present the top 100 banks and the 10 fastest-growing banks in the region. Also in this edition, you’ll find a country-by-country analysis of the results. Notably absent from this section is Iraq, which only has one bank in the index, Mansour Bank. We felt that an analysis of one sole bank might be misrepresentative of the country as a whole. There is also a separate analysis of Islamic banks’ performance. One aspect that remains the same is our user-friendly format. Last year, we updated our design to make the data easier on the eyes. You’ll find the results of the research laid out in graphs and infographics, punctuated with sharp commentary. We launched the BME100 because we wanted to give the region a fact-fuelled analysis of the banking and finance sectors’ performance across the Middle East. We all know that numbers don’t lie, so we thought it best to let them speak for themselves. An interesting story has unfolded over the last nine years. Countries such as Bahrain have loosened their grip on the index whereas banks in the UAE have tightened theirs. Lower oil prices have blacked many banks out of the index, but shifting dynamics have clearly given opportunity to others. Last year saw an Islamic bank top the index for the first time, and this year we have a newly-created entity at number one. Each year the BME100 has told a different story. First Abu Dhabi Bank debuted at number one in this year’s index, following its creation via a merger between First Gulf Bank and National Bank of Abu Dhabi. Could this signal a new dawn in an industry that is widely considered overripe for mergers? Only time will tell. See you next year! bankerme.net 3 6 METHODOLOGY 8 PUTTING THE BEST FINANCIAL INSTITUTIONS ON THE MAP 10 BEST 100 BANKS P.O. Box 502491, Dubai Media City, UAE 12 FASTEST GROWING FINANCIAL INSTITUTIONS Tel: +971 4 391 4681 Fax: +971 4 390 9576 bankerme.com 14 UNITED ARAB EMIRATES 18 ABU DHABI ISLAMIC BANK: INVESTING IN THE FUTURE CHAIRMAN Saleh Al Akrabi 20 DUBAI ISLAMIC BANK: UPGRADED BANKING CHIEF EXECUTIVE OFFICER TONY LONG [email protected] 21 MASHREQ BANK: 50 GOLDEN YEARS Tel: +971 4 391 4681 SAUDI ARABIA EDITOR - BANKER MIDDLE EAST 22 NABILAH ANNUAR [email protected] 26 BAHRAIN Tel: +971 4 391 3726 30 BANK ABC ISLAMIC: BANKS WITHOUT BORDERS EDITORS BUSINESS DEVELOPMENT ISLA MACFARLANE MANAGERS [email protected] DANIEL BATEMAN 32 KUWAIT Tel: +44 7875 429476 [email protected] Tel: +971 4 375 2526 MATT AMLÔT 36 OMAN [email protected] AKASH AMBALE Tel: +971 4 391 3716 [email protected] Tel: +971 4 433 5320 JORDAN WILLIAM MULLALLY 40 [email protected] Tel: +971 4 391 3718 NEEMA SAJNANI [email protected] 44 PALESTINE WEB EDITOR Tel: +971 4 391 3717 JESSICA COMBES [email protected] ADVERTISING 48 LEBANON Tel: +971 4 364 2024 [email protected] EDITORIAL ASSISTANT 52 BANK OF BEIRUT: TRIUMPHING OVER ADVERSITY KUDA MUZORIWA [email protected] Tel: +971 4 391 3729 53 ISLAMIC BANKS EDITORIAL [email protected] 57 APPENDIX CHIEF DESIGNER SENIOR DESIGNER BUENAVENTURA R. JALUAG, JR. FLORANTE MAGSAKAY [email protected] [email protected] Tel: +971 4 391 3719 Tel: +971 4 391 3724 DIGITAL MANAGER EVENTS MANAGER SIYAMUDHEEN PAINAYIL NATALIA KAILA [email protected] [email protected] Tel: +971 4 391 3722 Tel: +971 4 365 4538 FINANCE & EVENTS MARKETING DATA EXECUTIVE MANAGER KHALED TAHA CRIS BALATBAT [email protected] [email protected] Tel: +971 4 433 5322 Tel: +971 4 391 3725 FINANCE & DATA MANAGER SHAIS MEMON, ACCA, CMA 18 21 30 [email protected] Tel: +971 4 391 3727 HR & OFFICE MANAGER ADMINISTRATION & RIZZA INFANTE SUBSCRIPTIONS [email protected] CAROL BASA Tel: +971 4 391 4682 [email protected] Tel: +971 4 391 3709 [email protected] ©2018 CPI Financial. All rights reserved. No part of this publication may be reproduced or used in any form of advertising without prior permission in writing from the editor. Printed by United Printing & Publishing - Abu Dhabi, UAE PUBLISHED BY CPI FINANCIAL FZ LLC 20 52 REGISTERED AT DUBAI MEDIA CITY, DUBAI, U.A.E. bankerme.net 5 Methodology How we’ve ranked the region’s top financial institutions SCOPE INSTITUTIONS ur analysis covers financial institutions in The BME100 ranking includes institutions from the METHODOLOGY Middle Eastern countries, excluding Qatar. below categories: Within our chosen countries we have limited w Conventional banks; Oourselves to coverage of only the domestic w Islamic banks; institutions, which are domiciled and licensed in one of w Investment banks; the countries included in the analysis. w Financial services, w Investment and asset management companies. EXCHANGE RATES We gathered and analysed data from over 125 In compiling our index of the region’s leading banks, institutions within the region and filtered the top 100 we use the figures published in their annual reports institutions based on their total assets value to ensure and convert them to US dollar so that we can directly the institution is sizeable enough to make it into the top compare them against each other. 100 ranking. Out of these 100 institutions, one third are Most countries in the Middle Eastern region have Islamic and the remaining are conventional. pegged their currencies to the US dollar, hence they Different parameters have been used to rank these have had a fixed exchange rate against the US dollar institutions, which are elaborated on below along with for many years. The only significant exception to this the reasons for including those as a parameter. is Kuwait, which decided to drop its dollar peg in 2007 and peg its currency to a weighted basket of SCORING SYSTEM international currencies. The exchange rates taken from We have adopted a rigorous evaluation process to rank the central banks of each country as at 31 December the best 100 financial institutions in the region and have 2017 are mentioned below: adopted various financial parameters to evaluate them based on different weightages. The financial institutions that have been ranked the best institutions or the fastest Exchange Rate Country Currency Against USD growing have cumulatively scored as the best based on respective parameters for each ranking. UAE AED 3.6725 KSA SAR 3.750 Best Bank: points are given to each bank out of 100 Kuwait KWD 0.332 based on eight different parameters with their respective weightages mentioned below: Oman OMR 0.385 Bahrain BHD 0.376 Parameter Points Iran IRR 36,064 Total Assets 20 Iraq IQD 1,184.94 Net Profit Margin 20 Jordan JOD 0.709 Revenue 10 Lebanon LBP 1,507.5 Net Profit 10 Syria SYP 515.24 Return on Assets 10 Palestine USD* 1.00 Return on Equity 10 *Palestinian institutions use the US dollar as their currency Assets Turnover 10 Debt to Equity Ratio 10 Total 100 NOTE: Since most of the institutions in the BME100 are banks, the words ‘Bank’ and ‘Institution’ have been used interchangeably 6 Out of 100, the top bank based on any parameter The growth of the bank is considered relative to its scores the full points for that parameter and every other own size; therefore, we use the percentages for assets, institution is scored relative to that. For example, First Abu liabilities, revenues and net profit growth instead of the Dhabi Bank (FAB) is the biggest in terms of Total Assets growth in dollar ($) size. so it scores the full 20 points in that parameter and sets the benchmark for that parameter. The scoring of the CAPITAL ADEQUACY remaining banks for that parameter is done relative to that. The Capital Adequacy Ratio (CAR) is a measure of a Consideration has been given to an institution’s size bank’s available capital expressed as a percentage and efficiency and the cumulative score, based on all of a bank’s risk-weighted credit exposures. The parameters, is calculated to rank the institution. Capital Adequacy Ratio is used to protect depositors and promote the stability and efficiency of financial WEIGHTAGES FOR DIFFERENT PARAMETERS— systems around the world.