AFTER BLOCKADE, QATAR INJECTED $43 BILLION TO HELP BANKS
Following a 22 billion of deposits flowing out of the country since the blockade, Qatar invested about $43 billion in banks, said S&P Global Ratings.
The government and state-controlled companies injected the cash into the financial system, according to Mohamed Damak, S&P's senior director for financial services.
“The government intervened quite strongly to help banks and allow them to increase lending and finance government projects,” said Damak. “Banks and institutions from neighbouring countries that are part of the boycott pulled most of the deposits, while nervous investors outside of the region also withdrew funds.”
Damak further said that outflows from the Gulf countries involved in the standoff are expected this year as well. However, he added that the banks would be able to withstand the withdrawals because they hold 20% - 40% of their assets in liquid securities.