Banks in the Gulf are well placed to weather the storm

One of the main channels through which the euro-zone debt crisis could affect the oil-rich Gulf economies is via a drop in foreign capital inflows due to heightened global risk aversion. In particular, lending from euro-zone banks could fall. In this we take a closer look at the likely impact of deleveraging in Europe and elsewhere on credit conditions in the Gulf – and whether the region’s banks are in a good position to manage the potential fallout.