Profits at Syria’s banks plummeted 79.7 per cent in the first half of the year as a conflict raging for more than three years continues to take its toll on the economy.
“Banks are now operating in a war economy, but the outlook is completely different today when compared with the end of 2010, before the uprising began,” said Nassib Ghobril, the chief economist at Byblos Bank in Beirut.
Syria’s 14 private lenders, considered the crown jewels of the president Bashar Al Assad’s economic modernisation plan, have been struggling with a mismatch of assets and liabilities since the uprising began in March 2011.
Banking transactions such as trade finance and corporate lending have taken a big hit. Branches in hot spot areas have closed and deposits have moved to vaults at the banks’ headquarters in Damascus.
“Every bank has probably considered exiting, but the cost of exiting and re-entering later on is high,” Mr Ghobril said.
“These are affiliates of other Arab lenders, who have invested a lot in that market, taking the licence and the investment. For the Lebanese banks, they are used to operating in an unstable environment and hence adjusted to the situation. A number of them have shut down branches in dangerous areas for security reasons.”
Net income at International Bank for Trade and Finance fell to 1 million Syrian pounds (Dh26,253) in the first six months of this year, according to financial statements released on the Damascus Securities Exchange website this week. The Syrian lender made a profit of 59.3m pounds in the same period last year.
Byblos Bank Syria reported a profit of 163.06m pounds, compared with 783.3m pounds the year earlier.
Bank of Jordan Syria had losses of 304.5m pounds, compared with a profit of 1.52 billion pounds last year.
Net income at Qatar National Bank Syria fell to 3.17bn pounds, from 15.24bn pounds a year earlier.
Syria Gulf Bank reported a loss of 867.8m pounds, compared with a profit of 28.1m pounds last year.
Bank of Syria and Overseas reported a profit of 1.36bn pounds, compared with 2.179bn a year earlier.
