Mubasher: The Ratings agency Standard & Poor's (S&P) expected a decline in the banks of the United Arab Emirates in 2016, due to the deterioration in oil prices.
The New York based company said in its report also projected a fall in bank deposits in UAE banks during the current year as result to the decreasing oil prices, leading to lower liquidity, more tough policies, rising interest rates, slowdown in credit growth and the erosion of asset quality, which will be translated to higher credit losses.
The report clarified that there is a difference between the current oil crisis and the financial crises of 2008, as oil prices are much lower and expected to last for a longer period.
Given the importance of oil in the UAE economy, the New York based company expected a slowdown in the country’s economy growth accompanied with volatile performance in stock market.
