Research Note
Southeast Asian digital banks grew deposits strongly in 2024, but profitability remains elusive at Grab and Trust Bank
Deposits at Grab's GXS Bank and GX Bank rose from US$374 million to US$1,225 million over 2024 and Trust Bank's doubled to US$2.8 billion, but Grab's financial services segment posted negative adjusted EBITDA of US$105 million.
Saudi bank credit rose 5.0% in Q1 2025, outpacing the UAE's 2.7% and its own 2024 pace
Saudi bank credit rose 5.0% in Q1 2025 to SAR 3,102.0 billion, a quicker quarterly gain than in any quarter of 2024, while UAE gross credit grew 2.7%. Saudi lending outran deposits; UAE deposits stayed well ahead of loans.
Nigeria's bank recapitalisation deadline is driving rights issues and public offers in 2025, while mergers stay the exception
Access Holdings raised ₦351.0bn and Zenith Bank ₦350.46bn, taking both banks past the CBN's ₦500bn minimum for international licences; Fidelity, FCMB, GTCO and Wema are still raising, and banks have linked a June CBN letter on forbearance to their dividends.
Argentina's bank capital ratios stayed far above Latin American peers in 2024 as lending revived and dollar deposits nearly doubled
Argentine banks held capital equal to 30.2% of risk-weighted assets in December 2024, against 17.2% in Brazil and 16.98% for Colombian banks, while real peso lending rose 49.4%. By March 2025 the ratio was 7.5 percentage points lower than a year earlier.
GCC banks lifted 2024 profits on loan growth, while the new UAE corporate tax trimmed post-tax gains
Al Rajhi Bank's 2024 net income rose 18.7% and Kuwait Finance House's 3.0%; across eight large GCC lenders, loan growth, margins and the new UAE corporate tax explain most of the spread in 2024 results.
European banks held returns at multi-year highs in 2024, and supervisors expect a gradual moderation
EU/EEA banks reported a 10.5% return on equity in 2024, up only 10bp on 2023, as net interest margins slipped from their peak and fee income grew 9.6%; the ECB expects profitability to decline slightly for most banks.
Correspondent banking relationships continue to decline, with the Caribbean and Pacific Islands most affected
Active correspondents fell 62.6% in Melanesia and 52.1% in the Caribbean over 2011–2022, against 19.4% in Northern America; the Pacific now has a $68 million World Bank backstop, while the Eastern Caribbean relies on AML/CFT reform.
African bank capital ratios remained resilient in 2024 despite pressure from Nigeria's currency reforms and Ghana's debt restructuring
Ghana's bank capital ratio was 14.0% with reliefs in December 2024 but 11.3% without, below the 13% target, while Kenya's stood at 19.4% and Nigeria's improved to 13.3% at end-2023 as most banks booked FX valuation gains.
Kenya's mobile money usage reached 82.3% of adults in 2024, with M-PESA handling KSh 39.39 trillion a year
Mobile money reached 82.3% of Kenyan adults in 2024, up only 0.9 points since 2021, while daily use rose to 52.6% from 23.6%. M-PESA moved KShs 39.39 trillion in the year to March 2024, and bank usage rose to 52.5%.
MENA central banks cautiously navigated rate easing in Q4 2024, with banks watching NIM sensitivity
Saudi Arabia's repo rate fell 100bp to 5.00% by December 2024, while Kuwait cut once, by 25bp. In the fourth quarter Emirates NBD's net interest margin fell 10bp to 3.65%, while Al Rajhi Bank's margin rose 10bp to 3.27%.
South Korea's household debt-to-GDP ratio remained above 90% in 2024, keeping the Bank of Korea cautious on the pace of rate cuts
Korea's household debt-to-GDP ratio fell to 90.8% in Q3 2024 from 98.7% in 2021, yet the Bank of Korea has cut by 75bp in total since October 2024 and warns that lower rates and rising Seoul house prices could revive borrowing.
Generative AI tools move into production at the world's largest banks, reshaping operations and compliance functions
UK supervisors found 75% of surveyed financial firms already use AI, with foundation models at 17% of use cases. UBS cited 50,000 Copilot licences; 98% of Morgan Stanley adviser teams had adopted its assistant by June 2024.