It has been a difficult year for the Middle Eastern banking sector and this shows in the regional top 25. But there are reasons to be positive – the Gulf region remains strong, the overall figures from The Banker's Top 1000 World Banks suggest an increase in profits and there is a welcome new entry from Iraq.
Asian and Turkish banks stand out as the top performers in The Banker's Top 1000 World Banks for return on capital. But the more general trend across emerging markets is that banks with a retail focus appear to be prevalent among those generating the highest returns.
The banking landscape in Africa remains a case of potential unrealised, as its financial institutions' share of the Top 1000's overall assets and Tier 1 capital dipped slightly. However, the lowering of the average cost-to-income ration in the continent did provide some good news.
A bank's loans-to-deposits ratio is a good indicator of how prudent its funding strategy is - too high can mean too risky, but too low suggests it may not be achieving its full potential. This year's Top 1000 World Banks show that western Europe heads the list with the highest national average LTD and China has the lowest.
With the onset of the financial crisis, The Banker has focused much more of its Top 1000 data gathering on asset quality. This year, a total of 179 banks supplied comprehensive data on their levels of impaired assets, compared with 142 last year. While this still accounts for only 18% of total banks in the Top 1000, it is sufficient to begin to understand global trends in asset quality.