Omani banks, including Islamic institutions, have achieved a year-on-year credit growth of 7.3 per cent at RO23.5bn by November-end of 2017. Credit to the private sector alone rose by 6.5 per cent to RO20.9bn by the end of November 2017, the Central Bank of Oman (CBO) said in its latest monthly report.
The banking sector remained resilient during the first 11 months of last year supporting the economic diversification initiatives and credit needs of the corporate sector. In fact, credit growth is relatively better, despite the difficult economic environment.
As some of the projects have reached funding stage, growth in demand for credit is expected to continue this year as well.
The demand for credit from the corporate sector is mostly for funding projects, which are either state-owned entities or private sector projects. Duqm Refinery is one of the major projects, which is going to raise fund from both international and local institutions.
Of the total credit to the private sector, the household sector (mainly under personal loans) stood at 46.2 per cent closely followed by the non-financial corporate sector at 45.6 per cent, while financial corporations and other sectors obtained 4.9 per cent and 3.3 per cent share in credit, respectively.
Total deposits held by financial institutions grew by 6 per cent at RO21. 5bn, with private sector deposits growing by 6.7 per cent to RO14bn as at the end of November, 2017. Sector-wise, the contribution of households in total private sector deposits was 48.3per cent, followed by non-financial corporations at 29.4 per cent, financial corporations at 19.4 per cent, and the other sectors at 2.9 per cent.
Further, conventional banks have registered a 4.9 per cent year-on-year growth in credit by the end of November. Credit to the private sector increased by 3.7 per cent to RO18.2bn, shows the CBO statistics.
The investment of conventional banks in securities grew by 13.6 per cent to RO3bn.
Aggregate deposits held with conventional banks increased by 2.4 per cent to RO18.6bn in November 2017 from RO18.2bn a year ago. Government deposits with conventional banks edged up by 0.5 per cent to RO4.9bn, while deposits of public enterprises declined by 10.7 per cent to RO0.9bn during the same period. Private sector deposits which accounted for 67.3 per cent of total deposits with conventional banks, increased by 4.1 per cent to RO12.5bn in November 2017 from RO12.1bn a year ago.
Islamic banks provided financing to the extent of RO3bn as at the end of November 2017 from RO2.4 billion for the same period of the previous year. Total deposits held with Islamic banks and windows also registered a significant increase to RO2.9bn in November 2017 from RO2.1bn as at the end of November 2016. The total assets of Islamic banks and Windows combined, amounted to RO3.7bn as at the end of November 2017, constituting about 11.9 per cent of the banking system assets.