Many banks across Middle East downgraded; Dubai Entities suffer the same fate

In line with the deteriorating liquidity and profitability conditions in banks around the world over the coming year, S&P and Fitch reduced their outlook on variety of Middle Eastern financial and Govt institutions on Thursday.

S&P revises Dubai GREs’ outlook

Fitch cuts ratings on 15 Gulf banks

Banks are supported by Governments in this region and hence have almost no chance of going down. Additionally, for example, countries such as UAE, Kuwait and Saudi Arabia have added liquidity into their banking systems since Sep 2008 and some Governments have even guaranteed deposits for all national banks and some foreign banks. It is interesting to note that, in UAE, for example, 85% of fixed deposits in the banking system belong to UAE nationals.