Qatar Banks Seen To Have Highest Operational Efficiency In GCC In Q2

(MENAFN- Gulf Times) Qatari lenders were seen to have the highest operational efficiency within the Gulf banks during the second quarter (Q2) of 2025, according to Kamco Invest, a regional non-banking finance entity.
"Qatari banks continued to boast the lowest cost-to-income ratio in the GCC that reached a seven-quarter low level of 36.6% during Q2-2025," Kamco said in its latest report.
At the country level, the aggregates for Qatari banks showed a 110bps (basis points) plunge, followed by the UAE and Saudi Arabia banks with 70bps and 60bps fall respectively, it said.
The aggregate operating expenses for the listed banks in the GCC continued to decline for the second consecutive quarter reaching a three-quarter low level during Q2-2025, Kamco noted.
Total operating expenses for the GCC banking sector stood at $13.4bn during Q2 with a quarter-on-quarter decline of 1.5% and a year-on-year growth of 6.9%.
The quarterly decline showed mixed trends at the country level with three countries showing an increase and the remaining three showing a decline.
The UAE-listed banks showed the biggest fall in operating costs during the quarter that reached $4.6bn from $4.9bn in Q1-2025.
Qatari and Bahraini banks also showed declines of 4.5% and 4%, respectively, it said, adding on the other hand, Kuwait banks reported the biggest increase of 4.4% with total operating expenses reaching $1.6bn in Q2-2025.
The quarterly increase reported by Saudi and Omani banks was marginal, it added.
The decline in operating expenses resulted in a marginal drop in the cost-to-income ratio for the GCC banking sector that once again went below the 40% mark during Q2-2025. The ratio fell by 50bps to 39.5% at the end of the quarter compared to 40% during Q1-2025, reflecting a drop in the ratio for three of six country aggregates.
The report found that the Qatari banks' loan-to-deposit ratio was at 90.3% during Q2-2025, an improvement from 89.6% during Q1-2025.
The aggregate loan-to-deposit ratio for the GCC banking sector remained elevated above the 80% mark at the end of Q2-2025.
"The ratio has remained consistently above 80% over the last five quarters and reflects improving asset utilisation as well as better margins to offset pressure from lowering interest rates," it said.
Total customer deposits of listed GCC banks reached a new record high at the end of Q2-2025 at $2.74tn, registering a quarter-on-quarter growth of 3.5%.
The growth was broad-based as seen in higher quarterly customer deposits in all countries in the GCC.
At the country level, Kuwaiti banks saw the strongest growth in deposits at $334.8bn after a quarter-on-quarter growth of 4.7%.
The UAE-listed banks were next with a quarterly deposits growth of 4.1% to $941bn, the highest in the GCC, followed by banks in Saudi Arabia with a growth of 3.9% to $858.8bn. Banks in Bahrain, Oman and Qatar, have reported slightly smaller customer deposit growth during the quarter, it said banks Qatar banks GCC

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