Banking Sector C. Bank Assets Quality and Macroeconomic Environment 4. Policy Priorities Annex 1. Source Data for Balance Sheet Analysis and Credit Cycle Analysis Annex 2. Balance Sheet Exposures, end-2020 Annex 3. Determinants of Banks’ Holding of Government Securities: Econometric Analysis Annex 4. Monetary and Financial Measures to Mitigate Pandemic Efect References FIGURES Figure 1. Commercial Bank Assets Figure 2. Gross Cross-sectoral Balance Sheet Exposures in GCC Countries Figure 3. Balance Sheet Linkages Figure 4. Exposure in Foreign
data are collected through public information and country desks and may not be comprehensive. C. Bank Assets Quality and Macroeconomic Environment Weaker economic activity and lower oil prices can lead to a deterioration in asset quality and lower capital buffers in GCC banks. With about 16 percent of loan portfolios in trade and services sectors, asset quality in the banking systems is particularly sensitive to the pandemic ( Figure 19 ). Also, once policy support policies are withdrawn, a delayed rise in NPLs could be observed especially in high contact