Will the second wave of mergers and acquisitions in GCC banking continue to gather pace?

Will the second wave of mergers and acquisitions in GCC banking continue to gather pace?

More than a year after the initial onset of the coronavirus pandemic, the Gulf banking sector is seeing an increase in mergers and acquisitions (M&A), as lenders continue to deal with the economic fallout. In fact, in May last year , with most institutions expecting constrained profitability despite performing well in risk indicators. A report published by S&P Global Ratings in March noted that the long-lasting adverse effects of the 2020 shock are likely be felt particularly keenly in the UAE, Oman and Bahrain, and less so in Saudi Arabia and Qatar, and that a second wave of M&A could sweep further across the region as the full impact of the subdued economic environment becomes more visible. The so-called second wave follows an earlier run of M&A in the region – seen most prominently in the UAE – triggered by the 2014 oil price slump. A particularly emblematic tie-up came in 2019 with the MENA region's largest merger to date, between Abu Dhabi Commercial Bank, the Union National Bank and the Abu Dhabi-headquartered Islamic finance institution Al Hilal Bank. The merged entity became the UAE's third-largest bank, with an estimated $114.4bn in assets. Many analysts expected that the