Profitability in GCC Banking Systems

Abderazak Bakhouche ()
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Abderazak Bakhouche: Higher Colleges of Technology

Chapter 5 in Banking in the GCC, 2026, pp 123-165 from Palgrave Macmillan

Abstract: Abstract This chapter reviews several characteristics in GCC banking using unbalanced annual panel data covering the period 2002–22. Empirically, it examines the impact of several bank-specific and country-level variables on bank ROE, ROA, and NIM. The GMM regression results show that size, capital, diversification, liquidity, credit risk, and economic growth are significant determinants of bank profitability. Concentration positively affects profitability, but operating efficiency, inflation, and the rule of law are neutral. The results do not support the existence of performance differences between Islamic and conventional banks. Similarly, the global financial crisis (2008–09), the oil crisis (2014–15), and the COVID-19 lockdown did not hurt bank profits.

Date: 2026
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Persistent link: https://EconPapers.repec.org/RePEc:pal:pmschp:978-3-032-21737-0_5

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DOI: 10.1007/978-3-032-21737-0_5

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