Asian banks cautiously restart Gulf lending despite Iran risks
Major borrowers secured financing in August from Asian banks and other lenders.
Asian banks have cautiously resumed lending to borrowers in Gulf countries, despite the ongoing conflict in Iran, according to a report by the Straits Times Business. The revival in lending comes as Asian banks seek to deploy excess capital, with the region receiving over US$17 billion from Asian lenders in 2025, a record high and triple the amount in the previous year.
However, financing remains limited, with year-to-date extensions by Asian banks in the region down 72% compared to the same period in 2025. The Gulf deals, totaling over US$6.8 billion, were primarily facilitated by Asian banks, with most of the money flowing to Saudi Arabia and the United Arab Emirates. Despite the cautious approach, bankers acknowledge the need to protect relationships built in the Gulf and are willing to tolerate some risk associated with the Iran conflict, provided it does not escalate to the worst-case scenario.
Brief written by urgent.news from Straits Times Business's own syndicated text. Machine-written — may contain errors; check the original before relying on it.
