KUALA LUMPUR: Islamic banks in Gulf Cooperation Council (GCC) countries and South and Southeast Asia’s focus on low-risk retail finance, which will help protect their asset quality.
Moody's Investors Service said on Monday this was amid an uneven economic recovery across these regions.
Badis Shubailat, an analyst at Moody's, said regulatory forbearance has masked the deterioration in the banks' loan books, and high provisioning costs will continue to weigh on profitability, “but their capital and liquidity buffers should comfortably absorb unexpected losses".
“Consolidation within fragmented Islamic banking markets presents opportunities."
The report showed return on assets will remain on average below pre-pandemic levels this year becRead More »