GCC banks post record $16.6 billion profit in Q3 2025 amid strong lending and revenue growth

Gulf Cooperation Council (GCC) banks reported a record net profit of $16.6 billion in the third quarter of 2025, marking an 11.6 percent increase from the same period last year, according to an analysis by Kuwait-based Kamco Invest. Net profit at listed GCC banks also rose 2.2 percent from the previous quarter, representing the third consecutive quarterly increase, driven by broad-based revenue growth and improved cost efficiency.

The performance aligns with forecasts made earlier this year by Ernst & Young, which projected robust growth for the GCC banking sector in 2025, supported by economic diversification initiatives and favorable global financial conditions. Kamco Invest highlighted that the sequential profit increase was “mainly led by a broad-based increase in revenues for the sector and lower cost-to-income ratio that more than offset an increase in impairments during the quarter.”

Loan impairments rose to $2.6 billion in the third quarter, a three-quarter high, compared with $2.4 billion in the previous quarter. Despite the increase, overall sector revenues reached a record $36.8 billion, growing 3.3 percent sequentially. Qatari banks led the revenue growth with a 5.9 percent increase, followed by Bahrain-listed banks at 5 percent and UAE banks at 3.4 percent. Kuwaiti and Saudi banks saw revenues rise 3.3 percent and 2.1 percent, respectively.

Lending activity remained strong, with net loans rising 3.7 percent during the quarter, bringing total net loans to $2.31 trillion. Gross loans increased by 3.6 percent to $2.41 trillion. Kamco Invest noted that the growth in lending reflected resilient non-oil sector activity, with manufacturing and other non-oil industries performing above regional growth benchmarks.

The aggregate net loan-to-deposit ratio for the GCC banking sector climbed to a record 82.8 percent at the end of September. Saudi banks recorded a sector-high ratio of 97.6 percent, up 330 basis points from the previous quarter, driven by higher lending and a drop in customer deposits. Qatari banks followed with a ratio of 91 percent, up from 90.3 percent in the second quarter. UAE-listed banks saw their loan-to-deposit ratio rise for the second consecutive quarter to 69.4 percent, the highest level in recent periods, though still the lowest among GCC nations.

Kamco Invest described the overall outlook for the region’s banks as positive, citing strong revenue generation, disciplined cost management, and expanding lending activity as key drivers of sector resilience. Analysts note that while loan impairments are increasing, healthy revenue and profitability trends provide GCC banks with a solid foundation to support economic growth in both oil and non-oil sectors.

The third-quarter performance highlights the continued strength of the GCC banking sector, positioning it well for further growth as regional economies diversify and investment opportunities expand.