Jordan has a robust and mature banking and financial sector. Despite facing considerable instability and volatility in the region, it has remained resilient. Total assets grew by 2.6% in 2016 equating to 172.6% of GDP, making it one of the largest economic sectors in the country. We expect this trend to continue over the next five years with total assets growing by an average of 3.5% per annum. That said, we believe the government's austerity measures will limit opportunities in the public sector for the foreseeable future leaving banks highly reliant on the private sector for borrowing and saving opportunities.
Despite demonstrating significant resilience in what has been a challenging economic and security environment, Jordan's banking and insurance sector faces a number of challenges. The country's population is relatively poor with a GDP per capita of just USD3,258.5 in 2016. Many of the country's most wealthy citizens live abroad, predominantly in neighbouring GCC states, thus limiting demand for key products. The government's strict austerity measures reduce public sector opportunities and have forced many financial institutions to shift the focus of their expansion strategies to the private sector. On the whole, the market is highly concentrated with a small number of financial institutions dominating market share. This has reduced competition in the market and led to negative knock on consequences for customers including higher prices and limited innovation. Although government drives to increase regulation and enhance competition are underway, we believe the market will remain unchanged for the foreseeable future.