Research and Markets: Israel Commercial Banking Report Q4 2009 - Independent Forecasts and Competitive Intelligence on Israel's Commercial Banking Industry.

November 5, 2009 7:00 AM EST

DUBLIN--(BUSINESS WIRE)-- Research and Markets (http://www.researchandmarkets.com/research/f3cf95/israel_commercial) has announced the addition of the "Israel Commercial Banking Report Q4 2009" report to their offering.

This Israel Commercial Banking Report provides industry professionals and strategists, corporate analysts, banking associations, government departments and regulatory bodies with independent forecasts and competitive intelligence on Israel's commercial banking industry.

The publisher now rates 59 banking systems, and it is little surprise that the developed states dominate the top spots. The US and UK come first and second place, respectively, with scores of 88.7 and 88.0 out of 100. Of crucial importance to both scores is the very high rankings in the crucial 'Risks to realisation of returns - Market structure' sub-category, which account for 42% of the overall score. The two countries are ranked first and second in this category as well. This sub-category captures the size of the sector, and the potential for assets and loans to grow in US dollar terms. While both systems have been buffeted by the global credit crunch and will not post stellar growth numbers in percentage terms for the foreseeable future, the sheer size of the US and UK's financial systems means that there is massive potential for deposits, assets and client loans to rise. In addition, the generally solid institutional framework - which looks set to be augmented with new post-credit crunch regulations - will continue to provide a firm basis for the sector.

A Mixed Bag For The Developed States Following just behind the US and UK are a clutch of major developed state economies, including France (82.9, 3rd) and Germany (80.5, 4th globally), Canada (79.9, fifth), as well as Australia and Italy (78.4, joint sixth). All of these sectors have reasonable prospects into the medium term, having a large deposit and loan base, as well as the potential to grow substantially in volume (even if not percentage) terms. Several states are notable by their absence in this cluster. Austria falls somewhat short (72.4, 12th) of the pack, along with Greece (69.4, 16th), but it is the poor performance of Switzerland (62.7, 26th) and Japan (56.3, 34th) which really stands out. Both states are going to struggle to post increases in asset or loan growth in US dollar terms over the forecast period, to 2013, partially as a result of currency moves to the downside, but also in the case of Switzerland because of the relative weakness of the two key banking groups, UBS and Credit Suisse which had built up large franchises during the good years. Asia Rising

Emerging Europe, Limited Opportunities The emerging European states are posting surprisingly mediocre ratings outturns. The publisher highlights the potential for a systemic crisis in the region as the major Western European banks removing credit and capital from Central and Eastern Europe. These risks are exacerbated by the deep recessions the publisher sees in the Baltic states, Bulgaria, Russia and Turkey, and the risks of further currency crises that could create even greater economic dislocations, as the massive economic asymmetries that have built up in the region unwind. When taken in tandem with the relatively small size of the local economies and the rapid banking sector expansion seen in recent years, it is little surprise that the highest rated emerging European state is regional heavyweight Russia, at 73.8 (10th globally), and that the top 'new' EU member is the Czech Republic, at 64.5 (24th). Coming close to the bottom of both the regional and global peers groups are Latvia (39.0, 55th) and Ukraine (43.0, 51st), which have both been forced to tap the IMF and EU for emergency funds.

MENA Below Par The big story in the Middle East and North Africa (MENA) banking sectors has been high oil prices in recent years. Hydrocarbon revenues have swollen bank balances across the Gulf region, with significant amounts of capital and liquidity finding its way to North Africa as well. With the days of stellar oil prices gone for now (and not likely to return over the forecast period) the outlook is not so positive for the region, and this is reflected in the fact that the two highest ranked countries are the UAE at 14th and Saudi Arabia at 21st. No other MENA state has broken into the top 25 of their 59-strong ratings universe. Of particular concern is that while some progress has been made on putting the region's financial infrastructure on a more sustainable footing in recent years, it is still far too dependant upon oil revenues, and there are few drivers of either economic or commercial banking growth outside the natural resources sector. Indeed, it is particularly worrying that not one MENA state has broken in to the top 10 states in the 'Limits of potential returns - Market structure' sub-category. The best performer is the UAE, in 18th place, and even with the growth of Islamic banking products, the boom years are over. The publisher expects much more moderate growth in the financial space over the forecast period.

Opportunities In Africa While Africa remains one of the most 'under-banked' regions in the world and hence one of the most insulated from the global credit crunch - the commercial banking business environment ratings still reflect the major problems in operating even in the region's largest economies. South Africa's overall 70.5 rating score put it in 13th place globally, while in the 'Limits of potential returns - Market structure' category it scores 73.3, but it receives poor score for 'Risks to realisation of returns - Country risk', at 56.0. The country's main weaknesses, in common with Kenya and Nigeria, are bureaucracy, external economic risk and financial market risk, all of which deter potential investors from engaging more fully in the local market.

Key Topics Covered:

    --  Executive Summary
    --  SWOT Analysis
    --  Business Environment Outlook
    --  Global Commercial Banking Outlook
    --  Regional Outlooks
    --  Economic Outlook
    --  Competitive Landscape
    --  List Of Banks
    --  Company Profiles
    --  BMI Banking Sector Methodology

Companies Mentioned:

    --  Mizrahi Tefahot Bank Ltd
    --  Bank Hapoalim BM
    --  Bank Leumi Le-Israel BM
    --  Bank of Jerusalem Ltd
    --  Bank Otsar Ha-hayal Ltd
    --  Bank Yahav for Government Employees Ltd
    --  Israel Discount Bank Ltd
    --  Mercantile Discount Bank Ltd
    --  The First International Bank of Israel
    --  Union Bank of Israel Ltd

For more information visit http://www.researchandmarkets.com/research/f3cf95/israel_commercial

    Source: Research and Markets

Stocks Mentioned

Related Entities

• Credit Suisse
• UBS

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