The dominant sector in this years MEED 100 remains the financial services industry. Mainly consisting of banks, with a smattering of other institutions such as insurance providers, investment firms and stock market operators, this group comprises by far the largest sector on the list. The combined market value of the 45 firms is close to $392bn, or 43.3 per cent of the overall total.
The largest listed lender in the Middle East and North Africa region remains Qatar National Bank (QNB), which sits in second place overall, the same position as last year.
But hot on its heels is Saudi Arabias National Commercial Bank (NCB), which debuted this year in 3rd place, following its stock market flotation in the fourth quarter of 2014. The $6bn initial public offering (IPO) of 25 per cent of NCBs shares was the largest IPO ever in the Arab world. With a market capitalisation of $36bn compared with QNBs value of $36.1bn, the lender will be challenging for the 2nd spot in future MEED 100 rankings.
At the end of 2014, NCB had assets of $116bn and saw net profit of $2.3bn for the year. QNB had assets of $133.6bn and posted profit of $2.9bn. NCB has plans to convert to a fully Islamic bank, which could considerably increase its market share in the GCCs most populous nation.
Saudi Arabias Al-Rajhi Bank is the third-largest lender on the list; its overall position at number 5 was unchanged this year. The firm has a market capitalisation of $26.5bn, some $10bn behind the leading pair.
QNB is the dominant bank in Qatar, where the economy has been growing faster than in any other Gulf country in recent years. There are eight Qatari banks in the table, worth a combined $72.1bn. However, QNBs domestic market presence means its local rivals are far smaller. The next largest Qatari bank in the rankings is Masraf al-Rayan, which is in 30th place with a market capitalisation of $9.3bn. After that comes Qatar Islamic Bank in 42nd place, with a value of $6.4bn.
Overall, it is Saudi firms that form the strongest national group. The 12 institutions from the kingdom have a combined market capitalisation of $154.5bn, equivalent to 39.5 per cent of the finance sector as a whole. There are five in the top 20, with Samba Financial Group, Sabb and Riyad Bank comprising the others after NCB.
The next most important country in the list is the UAE, with 11 institutions valued at a total of $87.2bn, led by First Gulf Bank, National Bank of Abu Dhabi and Emirates NBD. In terms of the UAEs competing stock markets, the Abu Dhabi Securities Exchange (ADX) is ahead of the Dubai Financial Market (DFM), with six entrants listed on the ADX compared with five on the DFM.
There are also five Kuwaiti firms in this years rankings, as well as three from Morocco and one each from Bahrain, Egypt, Iran and Oman. Jordan has two financial services firms represented in the list. Overall, the GCC accounts for 38 of the 45 financial institutions on this years list, and their combined value of $356bn is equivalent to 91 per cent of the total value of the finance sector, highlighting the dominance of the bloc in the regions financial system.
There has been some reordering of the GCC institutions this year, however. Three Kuwaiti firms have been relegated from the list Boubyan Bank, Gulf Bank and Commercial Bank of Kuwait along with Dubai Investment.
For the Kuwaiti banks, the relegation is a continuation of last years trend. In 2014, Boubyan Bank was ranked in 82nd place, while Gulf Bank was in 85th and Commercial Bank of Kuwait was 92nd. The year before that, they were in 51st, 56th and 66th place respectively. Their decline appears symptomatic of the moribund state of Kuwaits economy in comparison to many of its Gulf neighbours. In their place came five other financial institutions that are new to the list this year. Aside from NCB, Qatar Insurance Company entered the list in 76th place, followed by Qatar International Islamic Bank in 94th place, Jordans Housing Bank for Trade & Finance at 91 and Saudi Arabias Bank Aljazira in 92th spot.
Overall, it has been a mixed year for the institutions that have maintained a place in the ranking. While 18 have climbed up the table compared with the same period last year, 19 have lost ground. Three stayed in the same position.
Indeed, four of the 10 fastest risers in the table over the past year were banks, with Commercial Bank of Dubai posting the biggest rise of 37 places to take it up to 60th spot. The lender has maintained a consistent level of profitability in recent years, despite the relatively tough market conditions.
Others to make impressive gains included Commercial International Bank in Egypt, which has been able to benefit from the improvement in economic conditions in its home market, and Bank Albilad in Saudi Arabia. The latter was given a rating of A2 by the US Moodys Investors Service in May 2014, with the agency saying the banks rating was a consequence of its solid capitalisation and profitability, strong asset quality and a resilient remittance business.
Others have not fared quite as well, however. Dubai Financial Market, the company that operates the stock exchange of the same name, lost 46 places to end up 85th overall. Others to fall back included Abu Dhabi Islamic Bank, Doha Bank and Bank Muscat.