Traditional Banks - Western Asia

Western Asia

In 2024, the net interest income in the Traditional Banks market market of Western Asia is projected to reach a staggering US$297.70bn.
Traditional Retail Banking dominates this market segment, with a projected market volume of US$180.50bn in the same year.
Looking ahead, the net interest income is expected to show an annual growth rate of 2.72% (CAGR 2024-2029), resulting in a market volume of US$340.40bn by 2029.
When comparing in Western Asia to the global market, it is worth noting that China is anticipated to generate the highest net interest income.
In 2024, China is expected to reach a staggering US$3,869.0bn in net interest income.
Traditional banks in Western Asia are increasingly adopting digital banking solutions to cater to the tech-savvy population.

Key regions: Germany, United Kingdom, France, Japan, China

Definition:

The Traditional Retail and Commercial Banks market refers to the financial services sector that provides a range of financial products and services to individuals and businesses through store-based branches and other traditional channels. Retail banking focuses on offering financial services to individual consumers, such as personal loans, savings and checking accounts, credit cards, and mortgages. Commercial banking, on the other hand, provides financial services to small and large businesses, including loans, lines of credit, and other financial products designed specifically for businesses.
The traditional banking market is highly competitive and characterized by the presence of large global players as well as regional and local banks. These banks have a long history of serving customers and have established relationships and a deep understanding of the financial needs of their communities. They offer a wide range of services and are able to provide personalized advice and support to their customers.
In this market, banks are continually seeking ways to improve their offerings and remain competitive by leveraging technology and offering innovative financial products and services. However, they also face challenges, such as increased competition and changing customer preferences, which are driving the need for continuous improvement and adaptation.
Overall, the traditional retail and commercial banking market provides a wide range of financial services to both individuals and businesses through established, trusted channels and continues to play a vital role in the financial landscape.

Structure:

The market consists of two segments:
- The Traditional Retail Banks market refers to financial services provided to individual consumers (e.g., personal loans, savings and checking accounts, credit cards, mortgages).
- The Traditional Commercial Banks market refers to financial services provided to businesses, including small and large enterprises (loans, lines of credit, other financial products specifically designed for businesses).

The market data comprises Net Interest Income, the value of Deposits, the value of Loans, Credit Card Interest Income, the number of ATMs as well as the number of Bank Branches.

Additional information:

The Banking market is highly competitive and characterized by the presence of large global players as well as regional and local banks. Banks are continually seeking ways to improve their offerings and remain competitive by leveraging technology and offering innovative financial products and services. Additionally, changes in regulations and the growing trend toward digitalization are shaping the retail and commercial banking market, creating opportunities for new entrants and forcing existing players to adapt.

Key players in this market are companies such as Industrial and Commercial Bank of China Ltd., JPMorgan Chase & Co., and HSBC Holdings.

Use the info button next to the boxes for more information on the data displayed.

Market

Region

Region comparison

Currency

Analyst Opinion

Traditional Banks in Western Asia are experiencing significant growth and development driven by various factors in the region.

Customer preferences: Customers in Western Asia are showing a growing inclination towards traditional banking services despite the rise of digital banking options. This preference can be attributed to a cultural trust in established banking institutions and a desire for personalized services that cater to their specific financial needs.

Trends in the market: In countries like Saudi Arabia and the United Arab Emirates, traditional banks are expanding their services to include wealth management and investment advisory to meet the demands of high-net-worth individuals in the region. Additionally, there is a trend towards Islamic banking products in countries with predominantly Muslim populations, such as Iran and Kuwait, where Sharia-compliant banking principles are gaining traction.

Local special circumstances: The geopolitical landscape in Western Asia plays a significant role in shaping the traditional banking market. Countries like Qatar and Bahrain, which serve as financial hubs in the region, attract international investments and contribute to the growth of their traditional banking sectors. Moreover, the oil-rich economies of countries like Kuwait and Oman provide ample liquidity for traditional banks to expand their lending activities.

Underlying macroeconomic factors: The stability of Western Asia's traditional banking market is closely tied to global oil prices, as many countries in the region rely heavily on oil revenues to drive economic growth. Fluctuations in oil prices can impact the liquidity and profitability of traditional banks, influencing their lending practices and overall performance. Additionally, government regulations and policies regarding foreign investment and capital flows play a crucial role in shaping the competitive landscape of the traditional banking sector in Western Asia.

Methodology

Data coverage:

Data encompasses B2B and B2C enterprises. Figures are based on Net Interest Income, Bank Account Penetration rate, the value of Deposits, the number of depositors, the value of Loans, the number of borrowers, Credit Card Interest Income, the number of ATMs as well as the number of Bank Branches.

Modeling approach / Market size:

Market sizes are determined by a combined Top-Down and Bottom-Up approach, based on a specific rationale for each market segment. As a basis for evaluating markets, we use data provided by the IMF, World Bank and the annual reports of the top 1000 Banks by asset size. Next we use relevant key market indicators and data from country-specific associations such as GDP, deposit interest rates, lending interest rates or bank account penetration rates. This data helps us to estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the particular market. For example, the S-curve function and exponential trend smoothing are well suited to forecast financial services for digital as well as traditional products and services.

Additional Notes:

The market is updated twice per year in case market dynamics change.