ARAB MONETARY FUND ISSUES ANNUAL REPORT ON FINANCIAL STABILITY IN ARAB COUNTRIES FOR 2018

by **claud39** Thu Jan 17, 2019 8:55 am

https://www.amf.org.ae/ar/content/%D8%B5%D9%86%D8%AF%D9%88%D9%82-%D8%A7%D9%84%D9%86%D9%82%D8%AF-%D8%A7%D9%84%D8%B9%D8%B1%D8%A8%D9%8A-%D9%8A%D8%B5%D8%AF%D8%B1-%D8%A7%D9%84%D8%AA%D9%82%D8%B1%D9%8A%D8%B1-%D8%A7%D9%84%D8%B3%D9%86%D9%88%D9%8A-%D8%AD%D9%88%D9%84-%D8%A7%D9%84%D8%A7%D8%B3%D8%AA%D9%82%D8%B1%D8%A7%D8%B1-%D8%A7%D9%84%D9%85%D8%A7%D9%84%D9%8A-%D9%81%D9%8A-%D8%A7%D9%84%D8%AF%D9%88%D9%84-%D8%A7%D9%84%D8%B9%D8%B1%D8%A8%D9%8A%D8%A9-%D9%84%D8%B9%D8%A7%D9%85-2018

ARAB MONETARY FUND ISSUES ANNUAL REPORT ON FINANCIAL STABILITY IN ARAB COUNTRIES FOR 2018

2019-01-17

Continuous efforts of central banks and Arab monetary institutions to develop the institutional and legislative framework to enhance financial stability,

The stability and robustness of the indicators of the banking sector in the Arab countries despite the risks and challenges,

The importance of following up the development of non-bank financial institutions and enhancing the coordination between the various supervisory and supervisory authorities on the non-banking financial sector,

The Arab Monetary Fund issued the first edition of the Financial Stability Report in the Arab States, which was prepared in cooperation and coordination between the Arab Monetary Fund and the Financial Stability Working Group in the Arab States, which is a member of the Board of Governors of Central Banks and Arab Monetary Institutions. Arab Central Banks.

In its seven chapters, the report addressed several economic and financial aspects of concern to the Arab countries as part of their efforts to enhance financial stability. Chapter I dealt with regional and international economic developments and their implications for Arab financial stability. This chapter sheds light on the challenges faced by the economies of the Arab countries and the impact of the expected repercussions of global economic developments such as high oil prices and rising US interest rates. The report stressed the importance of the role of policymakers and central banks in implementing structural and financial reforms to promote economic growth and positively affect financial stability. The Arab Economic Competitiveness Index, prepared by the World Economic Forum and the World Bank's Ease of Business Index, was also addressed.

The second chapter dealt with the developments of the legislative and institutional frameworks for financial stability in the Arab countries. The report pointed out the efforts of the central banks and the Arab monetary institutions to develop institutional and legislative frameworks to enhance financial stability, including coordination efforts with other supervisory authorities.

Chapter 3 deals with developments in the performance of the Arab banking sector and the potential risks. The report highlighted the most prominent financial indicators related to the Arab banking sector, which has a total assets of about $ 3.2 trillion, representing 130% of the total GDP of the Arab countries. The Arab banking sector has managed to reduce the ratio of non-performing facilities to its total facilities to the lowest level during the period 2013-2017 to reach 6.5 per cent by the end of 2017. This indicates an improvement in the quality of the sector's assets. The report showed that the Arab banking sector was characterized by high financial solvency. The capital adequacy ratio of the Arab banking sector reached its highest level during the period 2013-2017, reaching 27.5% at the end of 2017 which is higher than Which are applied internationally according to the Basel standard of 10. 5%, indicating that the Arab banking sector enjoys a high solvency and enhances its ability to absorb any potential losses. As for the performance of this sector, the report showed the continued rate of return on assets for the third year in a row to reach 1.5% at the end of 2017, which gives an indication of the efficiency of the process of granting credit to the banking sector and its ability to maintain assets and develop them by achieving appropriate returns Thereby enhancing the flow of investments to the banking sector and increasing confidence in its integrity. On the other hand, the rate of return on equity decreased slightly to 13.6% at the end of 2017. Despite this decline, however, it maintained rates higher than the period (2013-2016), which reflects the good performance of banks and their effectiveness in using their capital And enhance its ability to deal with possible future losses.

The fourth chapter dealt with the developments in the non-banking financial sector in the Arab countries and the potential risks. The chapter included an analysis of the performance of: the insurance sector, the Arab financial markets, the microfinance sector and other financing companies, and finally the exchange sector. The chapter concludes that the non-banking financial sector in the Arab countries, despite its small size compared to the banking sector, is stable and stable. The report stressed the need to organize all the institutions of the sector, especially finance companies, and provide a clear definition of it and provide the largest possible data and information about it, to identify the risks and challenges accurately. The report also called for following up efforts to develop non-bank financial institutions in Arab countries, given the small contribution of the non-banking financial sector to the financing of Arab economies.

In the fifth chapter, he presented an analysis of the results of stress tests in the Arab banking sector. These tests are considered important techniques to measure the ability of the Arab banking system to withstand shocks and to detect imbalances and weaknesses. In light of the results of these tests, the report showed that the Arab banking sector is strong and has achieved positive results in most of the results of the tests in most Arab countries.

Chapter 6 presents an analysis of the implications of developments in world oil prices on financial stability in Arab countries. The report showed the relationship between the fluctuation of oil prices on the one hand and exchange rates and GDP on the other hand, both for the Arab oil and non-oil countries. The report reviewed the policies of the oil states to meet the challenges of the decline in oil prices. The results of the questionnaire distributed by the Arab Monetary Fund showed that there is no indication of a decrease in financial stability resulting from this shock in the short term.

Finally, Chapter Seven reviews the impact of developments in workers' remittances and their repercussions on financial stability in Arab countries. The report pointed out that there are many challenges facing the sending and receiving countries, which should be taken into consideration such as the importance of channeling more remittances towards the official channels. In order to achieve this, the banking infrastructure must be developed. This will help reduce the costs of transferring funds and enhance financial coverage and stability. Financial.

He also pointed out that the issuance of this report came in cooperation with the Financial Stability Working Group in the Arab States, which is a result of the Board of Governors of Central Banks and Arab Monetary Institutions. He stressed the importance of continued efforts to develop the report in future publications to keep abreast of developments and developments related to financial stability issues. On the state of financial stability in the Arab countries, and the determinants and challenges it faces in the context of the efforts of supervisory authorities to achieve financial stability, to contribute to supporting precautionary decisions that contribute to the safety and the financial and banking sector. Me.

Report link:

First Report on Financial Stability in Arab Countries