Gulf central banks take steps to guard against credit defaults

Gulf states are moving to protect their economies from a war-driven credit squeeze, as central banks in Qatar, the UAE and Kuwait roll out measures to keep loans flowing and prevent a broader financial shock. 

Qatar’s central bank has allowed banks to defer loan repayments for up to three months for affected businesses and individuals, while instructing lenders not to impose penalties during the relief period, Bloomberg reports. 

The move is aimed at easing immediate liquidity stress as companies face delayed shipments, weaker demand and rising insurance and financing costs.

In the UAE, authorities have taken parallel action by easing capital requirements to ensure credit remains available, particularly for small and medium-sized enterprises exposed to supply chain disruptions. 

Kuwait has also signaled support for its financial system, with policymakers indicating readiness to step in to stabilize markets and assist businesses if conditions worsen.